In his classical model for a durable goods monopoly, Ronald Coase conjectured that a monopoly will never be able to charge a price above the equilibrium competitive price and the monopoly will end up forgoing dominant market power. Under certain circumstances, the ideas in the Coase conjecture break down, which we can see in the high-end fashion industry. In this paper, we will analyze some classical and modern contributions in the field of a durable goods monopolist. Based on the ideas of various contributors, we introduce a new model while less formidable vividly presents the complexity in the topic.
Rick Spellerberg, Department of Mathematics, Simpson Collegespeller@simpson.edu
"Monopolist Strategies in a Durable Goods Market,"
Rose-Hulman Undergraduate Mathematics Journal: Vol. 8
, Article 4.
Available at: http://scholar.rose-hulman.edu/rhumj/vol8/iss1/4