By Erik Arnold (auth.)
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Extra resources for Competition and Technological Change in the Television Industry: An Empirical Evaluation of Theories of the Firm
In time, rates of mark-up, price lines, and standard costing procedures become customary. As a result, 'good business practice' spreads through the industry, and an inherently uncertain price environment becomes stable and predictable (Cyert and March, 1963, pp. 115~20). Price setting becomes a 'programmed' (Simon, 1971, p. 193) activity within firms or involves using 'rules of thumb' (Baumol, 1967, p. 30). Under oligopoly conditions, predictable pricing behaviour is clearly likely to promote price stability (or, at least, movements in concert) at the level of the industry as a whole.
115~20). Price setting becomes a 'programmed' (Simon, 1971, p. 193) activity within firms or involves using 'rules of thumb' (Baumol, 1967, p. 30). Under oligopoly conditions, predictable pricing behaviour is clearly likely to promote price stability (or, at least, movements in concert) at the level of the industry as a whole. However, its origins are~ according to the behavioural stream of theory~ in the behaviour patterns of the managers of firms themselves, rather than being a property of a market form per se.
Saving is regarded as a special case of spending. Under monopoly competition, consumers trade pri~e against quality when making purchasing decisions. Chamberlin essentially views product differentiation from the demand side: an equilibrium is reached on the basis of consumers' perceptions of the product. A further refinement disaggregates goods into bundles of characteristics. Lancaster summarises the approach: 1. 2. 3. The good, per se, does not give utility to the consumers; it possesses certain characteristics, and these characteristics give rise to utility.
Competition and Technological Change in the Television Industry: An Empirical Evaluation of Theories of the Firm by Erik Arnold (auth.)