This week we look at advertising, covering:
- Different views on why advertising works.
- Several models and their welfare implications.
- Some empirics.
In this lecture, we cover:
- Why collude?
- Examples and types of collusion.
- Collusion in Dynamic Oligopoly.
- The Folk Theorem.
- Factors facilitating collusion.
This week we look more at product differentiation, covering
- Price discrimination in the Hotelling (1929) set-up.
- The Salop (1979) circular-city model, and how product proliferation may be used for entry deterrence.
- The Shaked and Sutton (1982) quality choice model of vertical differentiation.
- Some empirics, and other issues.
In this lecture we cover:
- The Dixit-Stiglitz (1977) exogenous product differentiation model.
- The Hotelling (1929) linear-city model of endogenous differentiation.