Advertising in a dynamic spatial monopoly. (English) Zbl 1064.90021
Summary: This paper characterises the dynamics of advertising investment in a spatial monopoly, contrasting the socially optimal behaviour of a benevolent planner against that of a profit-seeking monopolist. In steady state, the monopolist always distorts both output and advertising decisions as compared to the social optimum, except in a situation where, under both monopoly and social planning, the equilibrium entails full market coverage.
MSC:
| 90B60 | Marketing, advertising |
| 91B26 | Auctions, bargaining, bidding and selling, and other market models |
References:
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