In this paper, we study a simple model in which two horizontally differentiated firms compete in prices and targeted advertising on an initially uninformed market. First, the Nash equilibrium is fully characterized. We prove that when the advertising cost is low, firms target only their...

In this paper we characterize the equilibrium of a duopoly market which exhibits advertising spillovers. Interestingly, we prove that the relevant distinction is not between pure positive and pure negative advertising spillovers but between strong positive spillovers and weakly positive or...

In a spatial competition model with exogenous fixed costs and divisible goods, we obtain non-Suttonian results. When the economy is infinitely replicated, the number of firms does go to infinity but, as consumers' income goes to infinity, the equilibrium number of firms tends toward a finite...

The results previously obtained on the finiteness property in vertically differentiated markets, with cost functions having increasing or decreasing returns, are extended to a much larger class of cost functions with local properties in a vicinity of the zero output. Moreover, existence results...

The labor market is introduced into the standard vertical differentiation model, linking increasingly the quality of the product and the effort necessary for workers to produce it. Surprisingly, when two firms compete on the product market but are monopolies on the labor market, at equilibrium...

This paper suggests a modelling of the labelling procedure consistent with empirical observations, that allows the endogenous calculation of labelling criteria. The authority in charge of the labelling program chooses the level of labelling criteria so as to maximise the social surplus,...

We characterize the equilibrium of a game in vertically differentiated market which exhibits network externalities. There are two firms, an incumbent and a potential entrant. Compatibility means in our model that the inherent qualities of the goods are close enough. By choosing its quality, the...