The Procompetitive Effect of Demand-Enhancing Check-Off Programs
This article explores demand-enhancing check-off programs and how such programs may influence both private programs as well as industry market structure. Under duopoly, a firm may increase its sales through privately funding product quality improvements. However, such endogenous sunk costs may also be used to exclude a rival. Industry-funded check-off programs affect firms’ strategies and can be procompetitive. The rationale lies not only in how the check-off enhancement is perceived by consumers but also in the way the check-off’s crowding-out effect reduces the ability of a firm to use its private expenditures to bar a rival’s market access. Copyright 2007, Oxford University Press.
Year of publication: |
2007
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Authors: | Crespi, John M. ; Marette, Stéphan |
Published in: |
American Journal of Agricultural Economics. - Agricultural and Applied Economics Association - AAEA. - Vol. 91.2007, 2, p. 389-401
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Publisher: |
Agricultural and Applied Economics Association - AAEA |
Saved in:
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