Skip to main content

On the Theory of the Price- and Quality-Setting Firm with Uncertain Demand

Buy Article:

$43.00 plus tax (Refund Policy)

This paper examines the effects of demand uncertainty on price and product quality for the price- and quality-setting firm in the context of a general profit relation. It is shown that a firm reduces price but also improves quality in response to changes in demand risk when the expected utility function is submodular. Comparative statics predictions, when the firm is facing a simple increase in risk, depend on the specific functional forms of demand uncertainty and of the cost function and on whether the expected utility function is supermodular or submodular with respect to price and quality.
No References
No Citations
No Supplementary Data
No Data/Media
No Metrics

Document Type: Research Article

Affiliations: Chonnam National University, Republic of Korea

Publication date: 2003-12-01

  • Access Key
  • Free content
  • Partial Free content
  • New content
  • Open access content
  • Partial Open access content
  • Subscribed content
  • Partial Subscribed content
  • Free trial content
Cookie Policy
Cookie Policy
Ingenta Connect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more