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http://hdl.handle.net/2451/26262
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| Title: | The Quality of Complex Systems and Industry Structure |
| Authors: | Economides, Nicholas
Lehr, William |
| Issue Date: | Feb-1994 |
| Series/Report no.: | EC-94-06 |
| Abstract: | The structure of the telecommunications industry has changed
substantially in the last decade,raising public concern that the quality
of our information infrastructure may be adversely affected. This paper
extends the standard vertical differentiation model of imperfect
competition to address the case of the choice of quality in complex
systems. In these systems each demanded good consists of two
complementary components whose quality may be set by competing firms.
The extended framework is used to examine how changes in the vertical
and horizontal structure of the industry affect the choice of
compatibility, the overall system quality, the equilibrium market
prices, and the allocation of surplus. The results from this analysis
are interpreted in light of changes in the structure of the
telecommunications industry. |
| URI: | http://hdl.handle.net/2451/26262 |
| Appears in Collections: | Economics Working Papers
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