Product line competition and price promotions

被引：0
|
作者：
Bing Jing
Z. John Zhang
机构：
[1] Cheung Kong Graduate School of Business,
[2] The Wharton School,undefined
[3] University of Pennsylvania,undefined
来源：
Quantitative Marketing and Economics | 2011年 / 9卷
关键词：
Cannibalization; Product line; Price promotion; Price discrimination; Vertical differentiation; D43; L13; M31;
D O I：
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中图分类号：
学科分类号：
摘要：
Besides its familiar demand-redistribution effect, price promotion by a multi-product firm creates cannibalization, as lowering the price of one variety may erode the profits of its other varieties. We study endogenous product line selection and price promotions in a duopoly. In equilibrium, the ex ante symmetric firms may offer asymmetric product lines with unequal length. The two-product firm is more profitable. The single-product firm offers a larger mean discount and promotes more (less) frequently than its competitor when the former’s unit cost is relatively low (high).
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页码：275 / 299
页数：24
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