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- W1992009452 abstract "I investigate a pricing strategy that is aimed at deterring entry by applying a two-period model of a durable-goods monopolist. There exists an incumbent that is of two types, that is, high and low quality types. They differ in terms of their R&D capabilities, and the incumbent's type is assumed to be unknown to an entrant. If the entrant decided to enter the market, Nash–Bertrand price competition ensues between the incumbent and the entrant. I show that not only limit pricing but also prestige pricing signals the incumbent's quality type, which serves to discourage entry. In the prestige pricing, the high-quality type sells the products at an intentionally higher price. I also show that although limit pricing is more desirable than prestige pricing from a social welfare viewpoint, the incumbent can still choose prestige pricing." @default.
- W1992009452 created "2016-06-24" @default.
- W1992009452 creator A5008366962 @default.
- W1992009452 date "2008-07-01" @default.
- W1992009452 modified "2023-09-24" @default.
- W1992009452 title "Pricing strategy, quality signaling, and entry deterrence" @default.
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- W1992009452 doi "https://doi.org/10.1016/j.ijindorg.2007.07.005" @default.
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