Access

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If You Use a Screen Reader

This content is available through Read Online (Free) program, which relies on page scans. Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.

Durable Goods Monopoly with Entry of New Consumers

Joel Sobel
Econometrica
Vol. 59, No. 5 (Sep., 1991), pp. 1455-1485
Published by: The Econometric Society
DOI: 10.2307/2938375
Stable URL: http://www.jstor.org/stable/2938375
Page Count: 31
  • Read Online (Free)
  • Download ($10.00)
  • Subscribe ($19.50)
  • Cite this Item
Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Durable Goods Monopoly with Entry of New Consumers
Preview not available

Abstract

This paper analyzes a model of a dynamic monopolist who produces at constant unit cost. Each period a new cohort of consumers enters the market. Each entering cohort is identical. Consumers within a cohort have different tastes for the good. My main results are: If players are sufficiently patient, any positive average profit less than the maximum feasible level can be attained in a subgame-perfect equilibrium; in the subset of subgame-perfect equilibria in which players use stationary strategies, the seller cannot make sales at prices significantly greater than the lowest willingness to pay when period length goes to zero; and the seller attains the maximum profit when commitment is feasible by charging the same (static monopoly) price in every period.

Page Thumbnails

  • Thumbnail: Page 
1455
    1455
  • Thumbnail: Page 
1456
    1456
  • Thumbnail: Page 
1457
    1457
  • Thumbnail: Page 
1458
    1458
  • Thumbnail: Page 
1459
    1459
  • Thumbnail: Page 
1460
    1460
  • Thumbnail: Page 
1461
    1461
  • Thumbnail: Page 
1462
    1462
  • Thumbnail: Page 
1463
    1463
  • Thumbnail: Page 
1464
    1464
  • Thumbnail: Page 
1465
    1465
  • Thumbnail: Page 
1466
    1466
  • Thumbnail: Page 
1467
    1467
  • Thumbnail: Page 
1468
    1468
  • Thumbnail: Page 
1469
    1469
  • Thumbnail: Page 
1470
    1470
  • Thumbnail: Page 
1471
    1471
  • Thumbnail: Page 
1472
    1472
  • Thumbnail: Page 
1473
    1473
  • Thumbnail: Page 
1474
    1474
  • Thumbnail: Page 
1475
    1475
  • Thumbnail: Page 
1476
    1476
  • Thumbnail: Page 
1477
    1477
  • Thumbnail: Page 
1478
    1478
  • Thumbnail: Page 
1479
    1479
  • Thumbnail: Page 
1480
    1480
  • Thumbnail: Page 
1481
    1481
  • Thumbnail: Page 
1482
    1482
  • Thumbnail: Page 
1483
    1483
  • Thumbnail: Page 
1484
    1484
  • Thumbnail: Page 
1485
    1485