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The B.E. Journal of Theoretical Economics

Editor-in-Chief: Schipper, Burkhard

Ed. by Cervellati, Matteo / Fong, Yuk-fai / Peeters, Ronald / Puzzello , Daniela / Rivas, Javier

2 Issues per year


IMPACT FACTOR 2013: 0.259
5-year IMPACT FACTOR: 0.462

SCImago Journal Rank (SJR): 1.056
Source Normalized Impact per Paper (SNIP): 1.132

Mathematical Citation Quotient 2013: 0.12

Ensuring Quality Provision through Capacity Regulation under Price Competition

Nicolas Boccard1 / Xavier Y. Wauthy2

1University of Girona,

2Facultés Universitaires Saint-Louis and Université catholique de Louvain,

Citation Information: The B.E. Journal of Theoretical Economics. Volume 10, Issue 1, ISSN (Online) 1935-1704, DOI: 10.2202/1935-1704.1655, October 2010

Publication History

Published Online:
2010-10-27

We show in a simple duopoly model of vertical differentiation that when a welfare maximizing regulator wishes to ensure entry while avoiding strategic quality underprovision, regulating the incumbent's capacity is preferable to imposing a “Minimum Quality Standard” on products. In order to establish this result, we make an original contribution to the study of Bertrand-Edgeworth competition in a market with differentiated products.

Keywords: quality; minimum quality standards; price competition; capacity

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