The Why and How of Quality-Differentiated Demand

Abstract

Product quality is often a principal consideration in consumer decisions, yet there is no systematic treatment of such considerations in the undergraduate microeconomics core. Several recently published articles/ teaching notes address this matter by exploring the logic underlying quality considerations in consumer choice and the efficacy of markets in responding to those choices. This paper provides a brief overview and summary of the main themes of these earlier publications along with issues raised in the review process.