Durable-goods monopoly with endogenous innovation

Research output: Contribution to journalArticle

19 Citations (Scopus)

Abstract

While selling an existing product, a durable-goods monopolist may develop a new, improved product. The firm must consider the interaction between its intertemporal pricing and research and development (R&D) decisions. The interactions show a sharp dichotomy depending on pricing regimes. When it is optimal for the firm to continue to sell the old model along with the new model, the interactions disappear. However, when it is optimal for the firm to discontinue the sale of the old model after introducing the new model, the firm will face a time-inconsistency problem in its R&D decision.

Original languageEnglish
Pages (from-to)303-319
Number of pages17
JournalJournal of Economics and Management Strategy
Volume13
Issue number2
DOIs
Publication statusPublished - 2004 Jun 1
Externally publishedYes

Fingerprint

Innovation
Sales
Costs
Interaction
Pricing

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Management of Technology and Innovation
  • Strategy and Management
  • Economics and Econometrics

Cite this

Durable-goods monopoly with endogenous innovation. / Nahm, Jae Hyon.

In: Journal of Economics and Management Strategy, Vol. 13, No. 2, 01.06.2004, p. 303-319.

Research output: Contribution to journalArticle

@article{21f5527578e64d448d07737e1332767f,
title = "Durable-goods monopoly with endogenous innovation",
abstract = "While selling an existing product, a durable-goods monopolist may develop a new, improved product. The firm must consider the interaction between its intertemporal pricing and research and development (R&D) decisions. The interactions show a sharp dichotomy depending on pricing regimes. When it is optimal for the firm to continue to sell the old model along with the new model, the interactions disappear. However, when it is optimal for the firm to discontinue the sale of the old model after introducing the new model, the firm will face a time-inconsistency problem in its R&D decision.",
author = "Nahm, {Jae Hyon}",
year = "2004",
month = "6",
day = "1",
doi = "10.1111/j.1530-9134.2004.00012.x",
language = "English",
volume = "13",
pages = "303--319",
journal = "Journal of Economics and Management Strategy",
issn = "1058-6407",
publisher = "Wiley-Blackwell",
number = "2",

}

TY - JOUR

T1 - Durable-goods monopoly with endogenous innovation

AU - Nahm, Jae Hyon

PY - 2004/6/1

Y1 - 2004/6/1

N2 - While selling an existing product, a durable-goods monopolist may develop a new, improved product. The firm must consider the interaction between its intertemporal pricing and research and development (R&D) decisions. The interactions show a sharp dichotomy depending on pricing regimes. When it is optimal for the firm to continue to sell the old model along with the new model, the interactions disappear. However, when it is optimal for the firm to discontinue the sale of the old model after introducing the new model, the firm will face a time-inconsistency problem in its R&D decision.

AB - While selling an existing product, a durable-goods monopolist may develop a new, improved product. The firm must consider the interaction between its intertemporal pricing and research and development (R&D) decisions. The interactions show a sharp dichotomy depending on pricing regimes. When it is optimal for the firm to continue to sell the old model along with the new model, the interactions disappear. However, when it is optimal for the firm to discontinue the sale of the old model after introducing the new model, the firm will face a time-inconsistency problem in its R&D decision.

UR - http://www.scopus.com/inward/record.url?scp=2542558143&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=2542558143&partnerID=8YFLogxK

U2 - 10.1111/j.1530-9134.2004.00012.x

DO - 10.1111/j.1530-9134.2004.00012.x

M3 - Article

AN - SCOPUS:2542558143

VL - 13

SP - 303

EP - 319

JO - Journal of Economics and Management Strategy

JF - Journal of Economics and Management Strategy

SN - 1058-6407

IS - 2

ER -