International Pricing in a Generalized Model of Ideal Variety
研究一个广义理想品种模型中，市场大小和收入水平如何通过品种拥挤效应和收入效应影响国际定价与加价，发现大国价格更低、富国价格更高。
We examine international markups and pricing in a generalized version of an “ideal variety” model. In this model, entry causes crowding in variety space, so that the marginal utility of new varieties falls as market size grows. Crowding is partially offset by income effects, as richer consumers will pay more for varieties closer matched to their ideal types. We show theoretically and confirm empirically that declining marginal utility of new varieties results in: a higher own‐price elasticity of demand (and lower prices) in large countries and a lower own‐price elasticity of demand (and higher prices) in rich countries. The model is also useful for generating facts from the literature regarding cross‐country differences in the rate of variety expansion.