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v , v 1 2 1.5 1.0 0.5 0.0 M v 2 Z v 1 5 10 15 20 M v 1 Z v 2 t Figure 2: Quality =1 x , x 1 2 1.0 0.5 Z x 1 M x 2 Z x 2 M x 1 0.0 5 10 15 20 t Figure 3: Audience shares =1 12 14
a 1 , a 2 20 15 M M a1 a2 P P a 1 a2 10 5 0 5 10 15 20 t Figure 4: Advertising =1 v ,v 1 2 1.5 1.0 0.5 0.0 M v 2 5 10 15 20 M v 1 P P v1 v2 t Figure 5: Quality =1 this level is similar in both regimes. Moreover, advertising is increasing in . Note also, that while in the private duopoly both platforms provide the same quality and audience share, in the mixed duopoly the private platform provides higher quality and in consequence it obtains higher audience share. However these differences are decreasing in . Intuitively, advertising levels are increasing with because the platforms take advantage of the greater market power associated to an increased degree of product differentiation, which in turn is associated to a reduced incentive to provide a high differential quality by platforms in the mixed duopoly. Now, let us consider the case where advertising is socially harmful. In particular, Figures 7, 8 and 9 illustrate the comparisons among the mixed and private regimes with =09. Note that in contrast with the previous 13 15
Page 1: ad serie WP-AD 2012-03 Quality Choi
Page 4 and 5: 1 Introduction In the context of a
Page 6 and 7: controversial policy decisions with
Page 8 and 9: ( )= (3 − ) ; =1 2 6= (8) 9
Page 10 and 11: 1 = 2 (2 − 1) ( − 3 +4 − 22 )
Page 12 and 13: 1 = 2 +(2 − 7) ; −2 ( − 1
Page 16 and 17: x , x 1 2 1.0 0.5 M x 2 M x 1 P P x
Page 18 and 19: a ,a 20 1 2 M a 1 M a 2 P P a1 a2
Page 20 and 21: 50 40 30 t Z M 20 10 0.8 0.9 1 1.1
Page 22 and 23: 50 M 1 40 t 30 Z P M 2 20 10 0.8 0.
Page 24 and 25: Appendix In this section we incorpo
Page 26 and 27: [6]Beard,T.R.,R.B.EkelundJr.,G.S.Fo
Page 28: ad serie Ivie Guardia Civil, 22 - E

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