On MQS Regulation, Innovation and Market Coverage
University of Bologna, Italy, Department of Economics Working Paper DSE No. 575
7 Pages Posted: 16 Sep 2007
Date Written: Novermber 2006
We revisit Maxwell's (1998) analysis to show that MQS regulation has no effects on the high-quality firm's incentive to adopt a more efficient technology in a vertically differentiated duopoly with fixed costs of quality improvement and full market coverage.
Keywords: MQS, vertical differentiation, market coverage
JEL Classification: L13 L51,O31
Suggested Citation: Suggested Citation