Warranty, quality and price in the US automobile market

Evan J. Douglas, Dennis C. Glennon, Julia I. Lane

Research output: Contribution to journalArticle

Abstract

The observed negative relationship between quality and warranty in the US auto market is analysed using a cost-based approach developed by Cooper and Ross. The theory of warranty and quality choice by producers and consumers is extended by endogenizing the joint price, quality and warranty decision. Differences in producer costs and consumer preferences are found to explain the inverse relationship, which suggests that American manufacturers should adjust their pricing, warranty and quality strategy when entering foreign markets.

Original languageEnglish (US)
Pages (from-to)135-141
Number of pages7
JournalApplied Economics
Volume25
Issue number1
DOIs
StatePublished - 1993

Fingerprint

Automobile market
Warranty
Costs
Relationship quality
Consumer preferences
Quality choice
Pricing

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Warranty, quality and price in the US automobile market. / Douglas, Evan J.; Glennon, Dennis C.; Lane, Julia I.

In: Applied Economics, Vol. 25, No. 1, 1993, p. 135-141.

Research output: Contribution to journalArticle

Douglas, Evan J. ; Glennon, Dennis C. ; Lane, Julia I. / Warranty, quality and price in the US automobile market. In: Applied Economics. 1993 ; Vol. 25, No. 1. pp. 135-141.
@article{4973e0607aeb4210b9d0000c8bbee8a5,
title = "Warranty, quality and price in the US automobile market",
abstract = "The observed negative relationship between quality and warranty in the US auto market is analysed using a cost-based approach developed by Cooper and Ross. The theory of warranty and quality choice by producers and consumers is extended by endogenizing the joint price, quality and warranty decision. Differences in producer costs and consumer preferences are found to explain the inverse relationship, which suggests that American manufacturers should adjust their pricing, warranty and quality strategy when entering foreign markets.",
author = "Douglas, {Evan J.} and Glennon, {Dennis C.} and Lane, {Julia I.}",
year = "1993",
doi = "10.1080/00036849300000122",
language = "English (US)",
volume = "25",
pages = "135--141",
journal = "Applied Economics",
issn = "0003-6846",
publisher = "Routledge",
number = "1",

}

TY - JOUR

T1 - Warranty, quality and price in the US automobile market

AU - Douglas, Evan J.

AU - Glennon, Dennis C.

AU - Lane, Julia I.

PY - 1993

Y1 - 1993

N2 - The observed negative relationship between quality and warranty in the US auto market is analysed using a cost-based approach developed by Cooper and Ross. The theory of warranty and quality choice by producers and consumers is extended by endogenizing the joint price, quality and warranty decision. Differences in producer costs and consumer preferences are found to explain the inverse relationship, which suggests that American manufacturers should adjust their pricing, warranty and quality strategy when entering foreign markets.

AB - The observed negative relationship between quality and warranty in the US auto market is analysed using a cost-based approach developed by Cooper and Ross. The theory of warranty and quality choice by producers and consumers is extended by endogenizing the joint price, quality and warranty decision. Differences in producer costs and consumer preferences are found to explain the inverse relationship, which suggests that American manufacturers should adjust their pricing, warranty and quality strategy when entering foreign markets.

UR - http://www.scopus.com/inward/record.url?scp=0010395999&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=0010395999&partnerID=8YFLogxK

U2 - 10.1080/00036849300000122

DO - 10.1080/00036849300000122

M3 - Article

VL - 25

SP - 135

EP - 141

JO - Applied Economics

JF - Applied Economics

SN - 0003-6846

IS - 1

ER -