Automobile Markets with Network Effects : The Strategic Consequences of Leasing and Selling

作者：Shao Xiaoshuang^*; Tan Deqing

来源：6th International Conference on Financial Risk and Corporate Finance Management, 2014-06-30 to 2014-07-01.

• automobile
• the positive network externality
• lease
• durable goods
• the model of game

The relationship between leases and sales of durable goods has long been studied by academics. For automobile, selling can boost the development of the service network. So there is positive network externality. But leasing can't do this. To develop a better understanding of the network externality, we develop a two period game model of private car. And study the effect of the network externality on the firms' strategic of leasing and selling. The optimal second-period quantity decreases as the fraction of cars leased in the first-period increases. The network externality can amplify the effect of the fraction of cars leased on the optimal second-period quantity. The optimal fraction of cars leased in the first-period decreases as the network externality increases. If the network externality crosses a threshold then each firm stops leasing and only sells its product. If firms' strategy is to choose a combination of selling and leasing or only leasing, the network externality can't affect the optimal first-period quantity. If firms' strategy is only selling, the effect exists. In the competitive market, the effect of the network externality increases as the competition between the firms increases.

• 出版日期2014
• 单位西南交通大学