Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
986812 | Review of Economic Dynamics | 2015 | 22 Pages |
Abstract
We study a model with a durable good subject to periodic obsolescence and analytically characterize the optimal purchasing policy. The key result is that consumers optimally synchronize new purchases with the innovation cycle. The model simultaneously explains coordinated adoption without invoking network effects and provides a theoretical underpinning for a diffusion curve that features a temporary adoption slowdown.
Related Topics
Social Sciences and Humanities
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Economics and Econometrics
Authors
Ennio Stacchetti, Dmitriy Stolyarov,