Journal of Economic Theory and Econometrics: Journal of the Korean Econometric Society
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Journal of Economic Theory and Econometrics
JETEM/계량경제학보/計量經濟學報/JKES
Journal of the Korean Econometric Society

Property Rights and Planned Obsolescence

Vol.18, No.3, September , 33–59



  •   (Department of Economics, Kyung Hee University)

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Abstract  

We examine how varying the property rights affects the adoption of technologies and the compatibility between products with demand side and supply side economies of scale. In this environment, we obtain the following results. First, the social welfare is maximized by having all consumers use the same technology in the second period. Second, strong property rights may induce the dominant firm to introduce socially inefficient compatible technologies. Third, weak property rights may accelerate planned obsolescence. Finally, under weak property rights, openness of forward compatibility may prevent monopolist from implementing planned obsolescence.


Keywords
   Property Rights, Planned Obsolescence, Forward Compatibility

JEL classification codes
   D42, D62
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