Does a minimum quality standard always reduce the price of high quality products?

Panzar, John; Savage, I

dc.contributor.author	Panzar, John	en
dc.contributor.author	Savage, I	en
dc.date.accessioned	2012-03-22T18:51:50Z	en
dc.date.issued	2011	en
dc.identifier.citation	B.E. Journal of Economic Analysis and Policy 11(1) 2011	en
dc.identifier.issn	1935-1682	en
dc.identifier.uri	http://hdl.handle.net/2292/15028	en
dc.description.abstract	This paper investigates the standard finding that instituting a minimum quality standard within a vertically differentiated market unambiguously benefits consumers of high quality products. A competitive model is specified in which random cost shocks lead some firms to cheat in equilibrium on their reputation for high quality. When cheating occurs, instituting or raising the level of a minimum standard can lead to the price of high quality products either increasing or decreasing. The effect of a minimum quality standard on the price of high quality products becomes an empirical rather than a theoretical issue.	en
dc.publisher	Berkeley Electronic Press and Walter de Gruyter	en
dc.relation.ispartofseries	B.E. Journal of Economic Analysis and Policy	en
dc.rights	Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. Details obtained from http://www.sherpa.ac.uk/romeo/issn/1935-1682/	en
dc.rights.uri	https://researchspace.auckland.ac.nz/docs/uoa-docs/rights.htm	en
dc.title	Does a minimum quality standard always reduce the price of high quality products?	en
dc.type	Journal Article	en
dc.identifier.doi	10.2202/1935-1682.2333	en
pubs.issue	1	en
pubs.volume	11	en
dc.rights.holder	Copyright: Berkeley Electronic Press and Walter de Gruyter	en
dc.rights.accessrights	http://purl.org/eprint/accessRights/RestrictedAccess	en
pubs.subtype	Article	en
pubs.elements-id	215106	en
pubs.org-id	Business and Economics	en
pubs.org-id	Economics	en
dc.identifier.eissn	1935-1682	en
pubs.record-created-at-source-date	2012-03-23	en