#5179. Co-production or DIY: an analytical model of consumer choice and social preferences

August 2026publication date
Proposal available till 24-05-2025
4 total number of authors per manuscript0 $

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Journal’s subject area:
Management of Technology and Innovation;
Marketing;
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Abstract:
The purpose of this paper is to demonstrate how consumers choose among three different options offered by a firm in a monopolistic setting, namely, to buy a standard product with a non-customizable design, to ask the firm to customize a product using the consumer’s ideal design or to do the entire design task by themselves. The authors also investigate how social preference intensity and the possibility of reselling a product influence a consumer’s decision. The authors develop an analytical (game theoretical) consumer choice framework and incorporate a psychological factor into the model. The authors offer a closed-form solution and interval graphs showing that when the setup price is large (small), the proportion of the market that chooses to do-it-yourself (DIY) is large (small) and an increase in social preference intensity leads to a decrease (increase) in co-production.
Keywords:
Co-production; Consumer choice; DIY; Game theory; Hotelling model; Product co-creation; Product customization; Social preferences

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