PRODUCT QUALITY AND MARKET SIZE*
研究了市场规模是否影响产品质量,发现餐馆行业(质量主要靠可变成本)中质量范围随市场扩大而增加,而报纸行业(质量靠固定成本)中平均质量上升但品种增加有限。
Do larger markets offer better products? The question has implications for theories of cities and theories of market organization. We document that in the restaurant industry, where quality is produced largely with variable costs, the range of qualities on offer increases in market size. In daily newspapers, where quality is produced with fixed costs, the average quality of products increases with market size, but the market does not offer much additional variety as it grows large. These results are consistent with IO theories of endogenous product quality and with theories that emphasize the consumption advantages of cities.