ABSTRACT

This chapter reviews some of the early work on quality, from the classical period to the early 1950s. It provides a sample of major trends of thought during the period. To the extent that the objective of Chamberlin's work was construction of the monopolistically competitive model, and product differentiation served as the vehicle to accomplish that goal, then variable quality should be viewed as a side issue, or as simply an additional tool to assist in accomplishing the main objective. In addition to his work in microeconomics, Brems was one of the first economists to analyze the impact of variable quality on macroeconomic models. It is also possible that innovational quality change will create a new grade between two previous grades; Abbott's concept of horizontal quality was a contribution in the sense that it explicitly introduced consumer 'tastes' into the world of variable quality.