Price and quality competition in the restaurant industry: effects of restaurants’ reputation

Detalhes bibliográficos
Autor(a) principal: Ferreira, Fernanda
Data de Publicação: 2021
Outros Autores: Ferreira, Flávio, Fernandes, Paula Odete
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
Texto Completo: https://doi.org/10.34624/rtd.v37i0.26323
Resumo: This paper considers a quality and price competition between two asymmetric restaurants, by establishing a two-stage dynamic game model. We nd that the restaurant with the most reputation offers more food with a higher quality than its rival. We also analyse the effects of the difference of restaurants' reputation on the market equilibrium outcomes. We show that the increase in the reputation difference between restaurants decreases profits of the small restaurant and raises prots of the large restaurant, consumer surplus and social welfare.Furthermore, compared with the case under quantity competition instead of price, social welfare is higher under price competition, while the opposite holds for small restaurant's profits. However, the relationship of large restaurant's profits is ambiguous.
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spelling Price and quality competition in the restaurant industry: effects of restaurants’ reputationThis paper considers a quality and price competition between two asymmetric restaurants, by establishing a two-stage dynamic game model. We nd that the restaurant with the most reputation offers more food with a higher quality than its rival. We also analyse the effects of the difference of restaurants' reputation on the market equilibrium outcomes. We show that the increase in the reputation difference between restaurants decreases profits of the small restaurant and raises prots of the large restaurant, consumer surplus and social welfare.Furthermore, compared with the case under quantity competition instead of price, social welfare is higher under price competition, while the opposite holds for small restaurant's profits. However, the relationship of large restaurant's profits is ambiguous.Departamento de Economia, Gestão, Engenharia Industrial e Turismo da Universidade de Aveiro2021-10-21T00:00:00Zjournal articlejournal articleinfo:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionapplication/pdfhttps://doi.org/10.34624/rtd.v37i0.26323oai:proa.ua.pt:article/26323Journal of Tourism & Development; Vol 37 (2021); 21-29Revista Turismo & Desenvolvimento; vol. 37 (2021); 21-292182-14531645-9261reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAPenghttps://proa.ua.pt/index.php/rtd/article/view/26323https://doi.org/10.34624/rtd.v37i0.26323https://proa.ua.pt/index.php/rtd/article/view/26323/19030Direitos de Autor (c) 2021 Revista Turismo & Desenvolvimentohttps://creativecommons.org/licenses/by/4.0/info:eu-repo/semantics/openAccessFerreira, FernandaFerreira, FlávioFernandes, Paula Odete2022-09-26T10:57:41Zoai:proa.ua.pt:article/26323Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T16:06:18.897765Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse
dc.title.none.fl_str_mv Price and quality competition in the restaurant industry: effects of restaurants’ reputation
title Price and quality competition in the restaurant industry: effects of restaurants’ reputation
spellingShingle Price and quality competition in the restaurant industry: effects of restaurants’ reputation
Ferreira, Fernanda
title_short Price and quality competition in the restaurant industry: effects of restaurants’ reputation
title_full Price and quality competition in the restaurant industry: effects of restaurants’ reputation
title_fullStr Price and quality competition in the restaurant industry: effects of restaurants’ reputation
title_full_unstemmed Price and quality competition in the restaurant industry: effects of restaurants’ reputation
title_sort Price and quality competition in the restaurant industry: effects of restaurants’ reputation
author Ferreira, Fernanda
author_facet Ferreira, Fernanda
Ferreira, Flávio
Fernandes, Paula Odete
author_role author
author2 Ferreira, Flávio
Fernandes, Paula Odete
author2_role author
author
dc.contributor.author.fl_str_mv Ferreira, Fernanda
Ferreira, Flávio
Fernandes, Paula Odete
description This paper considers a quality and price competition between two asymmetric restaurants, by establishing a two-stage dynamic game model. We nd that the restaurant with the most reputation offers more food with a higher quality than its rival. We also analyse the effects of the difference of restaurants' reputation on the market equilibrium outcomes. We show that the increase in the reputation difference between restaurants decreases profits of the small restaurant and raises prots of the large restaurant, consumer surplus and social welfare.Furthermore, compared with the case under quantity competition instead of price, social welfare is higher under price competition, while the opposite holds for small restaurant's profits. However, the relationship of large restaurant's profits is ambiguous.
publishDate 2021
dc.date.none.fl_str_mv 2021-10-21T00:00:00Z
dc.type.driver.fl_str_mv journal article
journal article
info:eu-repo/semantics/article
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv https://doi.org/10.34624/rtd.v37i0.26323
oai:proa.ua.pt:article/26323
url https://doi.org/10.34624/rtd.v37i0.26323
identifier_str_mv oai:proa.ua.pt:article/26323
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv https://proa.ua.pt/index.php/rtd/article/view/26323
https://doi.org/10.34624/rtd.v37i0.26323
https://proa.ua.pt/index.php/rtd/article/view/26323/19030
dc.rights.driver.fl_str_mv Direitos de Autor (c) 2021 Revista Turismo & Desenvolvimento
https://creativecommons.org/licenses/by/4.0/
info:eu-repo/semantics/openAccess
rights_invalid_str_mv Direitos de Autor (c) 2021 Revista Turismo & Desenvolvimento
https://creativecommons.org/licenses/by/4.0/
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Departamento de Economia, Gestão, Engenharia Industrial e Turismo da Universidade de Aveiro
publisher.none.fl_str_mv Departamento de Economia, Gestão, Engenharia Industrial e Turismo da Universidade de Aveiro
dc.source.none.fl_str_mv Journal of Tourism & Development; Vol 37 (2021); 21-29
Revista Turismo & Desenvolvimento; vol. 37 (2021); 21-29
2182-1453
1645-9261
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
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