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- W3076243047 abstract "Abstract This paper investigates how the incentives for cost reduction in a differentiated industry depend upon the degree of product substitutability. When goods are imperfect substitutes, both Cournot and Bertrand competition result in underinvestment in the sense that a social planner would be willing to pay more for a given cost reduction than a profit-maximizing firm. Overinvestment may occur when the goods are sufficiently close substitutes. Similarly, Cournot competition provides a stronger incentive to innovate than Bertrand competition if the degree of substitutability is low, and a weaker incentive if this degree is high." @default.
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- W3076243047 date "1991-01-01" @default.
- W3076243047 modified "2023-09-23" @default.
- W3076243047 title "The Incentives for Cost Reduction in a Differentiated Industry" @default.
- W3076243047 hasPublicationYear "1991" @default.
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