In this paper we consider a model of oligopolistic competition where firms make a two-dimensional product line decision. They choose a location in style space, thus inducing horizontal differentiation, and produce different qualities (a product line) of a given good (vertical differentiation),...

After the communist regimes collapsed throughout Eastern Europe and the former Soviet Union, they were replaced (at least initially) by relatively wide-ranging democracy. Measured by the indices of political freedom and civil liberties published by the Freedom House (see the Technical Annex for...