On the consistent use of linear demand systems if not all varieties are available

Linear demand formulations for price competition in horizontally differentiated products are sometimes used to compare situations where additional varieties become available, e.g. due to market entry of new firms. We derive a consistent demand system to analyze such situations and highlight potential problems that can arise from an inconsistent approach.

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Year of publication:	2008
Authors:	Höffler, Felix
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 4.2008, 14, p. 1-5
Publisher:	AccessEcon

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	D1 - Household Behavior and Family Economics ; L1 - Market Structure, Firm Strategy, and Market Performance
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005110848