In this lecture we complete our analysis of product differentiation, looking at location choice, welfare, discriminatory equilibria, product proliferation and some empirics. Lecture 7

Lecture 7: More on product differentiation

5 thoughts on “Lecture 7: More on product differentiation

  • 10th December 2013 at 22:58
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    On slide 6 I don’t understand how you calculated the result for B’s FOC, I can’t work out why there is a +2t(b-a) on the top half of the fraction. Can you explain, please? Thanks.

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  • 10th December 2013 at 23:19
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    These are last year’s slides… The expressions for pA and pB are not perfectly symmetric because the demand for firm B is 1-x* rather than x*.

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  • 11th December 2013 at 00:04
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    This example appears to be more complex, so is probably better to work from.
    I’m fine with finding the value of x*, I just don’t understand how to calculate 1-x*. – I still don’t understand the +2t(b-a).

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  • 11th December 2013 at 00:48
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    Come to my office hours on Thursday, and we’ll go through this together. It’s a bit much to go through here.

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  • 11th December 2013 at 01:00
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    Thanks….But Thurs is the day before the test.

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