Luxury products provide social signal value rather than pure performance.
Social signaling is often (usually? Outside subsistence cases - there are some good studies showing how this switches over) more important than performance.
Sometimes performance and social signaling are correlated, but they don't have to be.
I'm not sure how Nash's game theory is related to this. Care to elaborate?
A product marketplace is pretty much the perfect example of a non-competitive game. Indeed, the New Yorker used is as one:
The setting could be nuclear negotiations, such as the ones currently taking place between Iran and the great powers. It could be a product market, in which a number of firms compete for business.[1]
This is a relatively mature field, and there are some fairly comprehensive ways of expressing the likelihood of success of a product.
Unfortunately your formula doesn't capture anything like enough of the complexities of a market place.
But hey - it is simple, and you typed it quickly, and it seems like it could be right so nothing else matters, right?
Virality without value advantage tends to be short-lived.
Social signaling is part of the ‘value’ in my model.
The utility of existing competition and their costs are included in the term ‘marginal’.
I am aware that my simple model, occurring in a couple minutes, is incomplete that’s why I asked for refinements. Including factors like distribution & marketing seems very useful. However, capturing imperfect rationality does not seem possible for a simple model.
Do you have references to the ‘fairly comprehensive ways of expressing the likelihood of success of a product’?
Sorry, virality. Damn autocomplete.
Luxury products provide social signal value rather than pure performance.
Social signaling is often (usually? Outside subsistence cases - there are some good studies showing how this switches over) more important than performance.
Sometimes performance and social signaling are correlated, but they don't have to be.
I'm not sure how Nash's game theory is related to this. Care to elaborate?
A product marketplace is pretty much the perfect example of a non-competitive game. Indeed, the New Yorker used is as one:
The setting could be nuclear negotiations, such as the ones currently taking place between Iran and the great powers. It could be a product market, in which a number of firms compete for business.[1]
This is a relatively mature field, and there are some fairly comprehensive ways of expressing the likelihood of success of a product.
Unfortunately your formula doesn't capture anything like enough of the complexities of a market place.
But hey - it is simple, and you typed it quickly, and it seems like it could be right so nothing else matters, right?
[1] https://www.newyorker.com/news/john-cassidy/the-triumph-and-...