This article is cited in 10 papers

Product diversity in a vertical distribution channel under monopolistic competition

Igor A. Bykadorov^ab, Sergey G. Kokovin^ab, Evgenyi V. Zhelobodko<sup>b

a</sup> Sobolev Institute of Mathematics Siberian Branch of RAS
^b Novosibirsk State University

Abstract: In Russia the chain-stores gained a considerable market power. In the paper we combine a Dixit–Stiglitz industry with a monopolistic retailer. The questions addressed are: Does the retailer always deteriorate welfare, prices and variety of goods? Which market structure is worse: Nash or Stackelberg behavior? What should be the public policy in this area?

Keywords: monopolistic competition, Dixit–Stiglitz model, retailer, Nash equilibrium, Stackelberg equilibrium, social welfare, Pigouvian taxation.

UDC: 519.832.2
BBK: 22.18

 English version: Automation and Remote Control, 2014, 75:8, 1503–1524