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Strategic quality choice under uncertainty: a real options approach

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Strategic quality choice under uncertainty: a real options approach. / Pawlina, G; Kort, Peter M.
In: Manchester School, Vol. 78, No. 1, 01.2010, p. 1-19.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Pawlina, G & Kort, PM 2010, 'Strategic quality choice under uncertainty: a real options approach', Manchester School, vol. 78, no. 1, pp. 1-19. https://doi.org/10.1111/j.1467-9957.2009.02124.x

APA

Pawlina, G., & Kort, P. M. (2010). Strategic quality choice under uncertainty: a real options approach. Manchester School, 78(1), 1-19. https://doi.org/10.1111/j.1467-9957.2009.02124.x

Vancouver

Pawlina G, Kort PM. Strategic quality choice under uncertainty: a real options approach. Manchester School. 2010 Jan;78(1):1-19. doi: 10.1111/j.1467-9957.2009.02124.x

Author

Pawlina, G ; Kort, Peter M. / Strategic quality choice under uncertainty: a real options approach. In: Manchester School. 2010 ; Vol. 78, No. 1. pp. 1-19.

Bibtex

@article{995c725f8b844a55b9e32bb4766e42c9,
title = "Strategic quality choice under uncertainty: a real options approach",
abstract = "In this paper we study the effects of demand uncertainty and imperfect competition on market entry and product quality choice. We allow for either fixed or flexible quality. Under a fixed quality choice, the follower chooses a higher quality provision. Quality is shown to generally increase with the volatility of demand. The strategic quality choice by the follower may trigger the exit of the leader. Furthermore, flexibility in the leader's quality choice can constitute a strategic disadvantage. Finally, the degree of horizontal differentiation between the supplied goods plays a pivotal role in determining the market structure in the long run.",
author = "G Pawlina and Kort, {Peter M}",
note = "The definitive version is available at www.blackwell-synergy.com",
year = "2010",
month = jan,
doi = "10.1111/j.1467-9957.2009.02124.x",
language = "English",
volume = "78",
pages = "1--19",
journal = "Manchester School",
issn = "1463-6786",
publisher = "Wiley-Blackwell",
number = "1",

}

RIS

TY - JOUR

T1 - Strategic quality choice under uncertainty: a real options approach

AU - Pawlina, G

AU - Kort, Peter M

N1 - The definitive version is available at www.blackwell-synergy.com

PY - 2010/1

Y1 - 2010/1

N2 - In this paper we study the effects of demand uncertainty and imperfect competition on market entry and product quality choice. We allow for either fixed or flexible quality. Under a fixed quality choice, the follower chooses a higher quality provision. Quality is shown to generally increase with the volatility of demand. The strategic quality choice by the follower may trigger the exit of the leader. Furthermore, flexibility in the leader's quality choice can constitute a strategic disadvantage. Finally, the degree of horizontal differentiation between the supplied goods plays a pivotal role in determining the market structure in the long run.

AB - In this paper we study the effects of demand uncertainty and imperfect competition on market entry and product quality choice. We allow for either fixed or flexible quality. Under a fixed quality choice, the follower chooses a higher quality provision. Quality is shown to generally increase with the volatility of demand. The strategic quality choice by the follower may trigger the exit of the leader. Furthermore, flexibility in the leader's quality choice can constitute a strategic disadvantage. Finally, the degree of horizontal differentiation between the supplied goods plays a pivotal role in determining the market structure in the long run.

U2 - 10.1111/j.1467-9957.2009.02124.x

DO - 10.1111/j.1467-9957.2009.02124.x

M3 - Journal article

VL - 78

SP - 1

EP - 19

JO - Manchester School

JF - Manchester School

SN - 1463-6786

IS - 1

ER -