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Stephan Marette
''Is a Minimum Quality Standard Socially Optimal?''
( 2008, Vol. 12 No.39 )
This paper explores the role of a minimum quality standard when the quality choice is discrete. A minimum quality standard is never a socially optimal policy under Bertrand and Cournot competition. Conversely, it is often optimal to subsidize or tax the high quality in order to implement different firms' choices corresponding to a situation of welfare maximization.
JEL: L5 - Regulation and Industrial Policy: General
Manuscript Received : Oct 27 2008 Manuscript Accepted : Dec 14 2008

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