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- W2910348043 abstract "In this article I explore an incumbent monopolistis incentives to upgrade in the future his durable network product in the presence of overlapping generations of customers and a potential entrant who may also sell a version of the same quality. When the incumbent has commitment power and entry cannot be deterred, he decides to withhold the upgrade when network e§ects are weak, as strategic complementarity between the competitorsiintertemporal pricing decisions allows him to charge su¢ ciently patient forward-looking consumers more in the present market. On the other hand, he commits to upgrade when network e§ects are strong, as there is strategic substitutability between Ormsiprices. Regarding welfare, the frequency of new products is not socially optimal when the quality improvement is negligible and smaller than their adoption cost. I Ond that both potential or actual competition and the incumbentis commitment power are sources of ine¢ ciency." @default.
- W2910348043 created "2019-01-25" @default.
- W2910348043 creator A5068509697 @default.
- W2910348043 date "2015-01-01" @default.
- W2910348043 modified "2023-09-23" @default.
- W2910348043 title "Efficient Upgrading in Durable Network Goods: Is Commitment Always Good?" @default.
- W2910348043 doi "https://doi.org/10.22004/ag.econ.270543" @default.
- W2910348043 hasPublicationYear "2015" @default.
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