We combine two extensions of the differentiated duopoly model of Dixit (1979), namely Caminal and Vives (1996) and … Brander and Spencer (2015a,b), to analyze the effect of consumer learning on firms' incentives to differentiate their products … more likely to invest in differentiation with consumer learning than without. This is in line with implications of the …

behavior. First, price-matching diminishes firms' incentives to lower prices to attract consumers who have no search costs …. Second, for consumers with positive search costs, price-matching lowers the marginal benefit of search, inducing them to … accept higher prices. Finally, price-matching can lead to asymmetric equilibria where one firm runs fewer sales and both …

incorporate consumer learning and consumer heterogeneity into an empirical dynamic oligopoly model. In the model, firms choose … experiment improves the rate of learning, and lowers the equilibrium generic prices throughout the period. However, it hardly …