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Market equilibrium and optimal product diversity: a logit specification

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  • ANDERSON, S.
  • de PALMA, A.
Abstract
This paper has two objectives. First, we present the logit model of discrete consumer choice and apply it to an oligopoly model of product differentiation. Second, we reconsider the question of monopolistic competition and optimal product diversity. The model suggests that when the market outcome involves a large number of products, the market solution does not deviate far from the social optimum.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • ANDERSON, S. & de PALMA, A., 1986. "Market equilibrium and optimal product diversity: a logit specification," LIDAM Discussion Papers CORE 1986008, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:1986008
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    Cited by:

    1. Simon P. Anderson & Andre de Palma, 1989. "The Logit as a Model of Product Differentiation: Further Results and Extensions," Discussion Papers 913, Northwestern University, Center for Mathematical Studies in Economics and Management Science.

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