Arbeitspapier
The welfare effects of endogenous quality choice in cable television markets
We measure the welfare consequences of endogenous quality choice in imperfectly competitive markets. We introduce the concept of a "quality markup" and measure the relative welfare consequences of market power over price and quality. For U.S. paid-television markets during 1997-2006, we find that not only are cable monopolists' prices 33% to 74% higher than marginal costs, but qualities are also 23% to 55% higher than socially optimal and the welfare costs of each are similar in magnitude. Such evidence for "quality inflation" by monopolists is at odds with classic results in the literature.
- Sprache
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Englisch
- Erschienen in
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Series: Working Paper ; No. 202
- Klassifikation
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Wirtschaft
Information and Product Quality; Standardization and Compatibility
Oligopoly and Other Imperfect Markets
Entertainment; Media
Telecommunications
Model Construction and Estimation
- Thema
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industrial organization
endogenous quality
imperfect competition
monopoly
cable television
pay television
welfare
quality markup
- Ereignis
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Geistige Schöpfung
- (wer)
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Crawford, Gregory S.
Shcherbakov, Oleksandr
Shum, Matthew
- Ereignis
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Veröffentlichung
- (wer)
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University of Zurich, Department of Economics
- (wo)
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Zurich
- (wann)
-
2015
- DOI
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doi:10.5167/uzh-112429
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Crawford, Gregory S.
- Shcherbakov, Oleksandr
- Shum, Matthew
- University of Zurich, Department of Economics
Entstanden
- 2015