Competitive Advertising And Pricing In Duopolies

Excerpt from Competitive Advertising and Pricing in Duopolies: The Implications of Relevant Set-Response Analysis Consumers choose from among those brands they consider relevant. Advertising spending influences whether consumers consider brands as relevant. Firms set advertising and price and react, re-react, etc., until an equilibrium is reached. We demonstrate how advertising affects the price equilibrium, how price affects the advertising equilibrium, and how external factors affect both. We show how the ability to anticipate competitive response affects advertising strategies and profits and we compare the competitive formulation to a noncompetitive formulation. The analysis is compatible with an evaluation cost theory of consumer behavior. We examine empirical support for the theories. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in our edition. We do, however, repair the vast majority of imperfections successfully; any imperfections that remain are intentionally left to preserve the state of such historical works.