Chonnam National University

On the Theory of the Price- and Quality-Setting Firm with Uncertain Demand

Email address: kit2603@chonnam.chonnam.ac.kr

Keywords: The Price- and Quality-Setting Firm, Demand Uncertainty, a simple increase in risk

JEL Classifications: D81, L12

Abstract:
This paper examines the effects of demand uncertainty on price and product quality for the price- and quality-setting firm in the context of a general profit relation. Comparative-statics predictions, when faced with a simple increase in risk, depend on the specific functional forms of demand uncertainty and of the cost function, and on whether the expected utility function is supermodular or submodular.

PDF file of paper: kim_iltae.pdf

Session: Industrial Organization Theory I

Time: Saturday, 7 July, 8am - 9:30am

Room: D