Abstract
This paper analyzes to find a general model of the decision to add a quality attribute to a software product with the objective of maximizing consumers’ welfare (utility) while maximizing producer’s and marketers’ profit at the same time. The optimal strategy, optimal combination of software quality attributes, is found in two steps. First we derive from the firm optimization problem the optimal price as a function of software quality attributes. Second we solve the consumer problem from substituting price by this optimal price. Although this paper’s focus is on software products, this model can be generalized to pricing decisions for any kind of high-tech product with many attributes.
Recommended Citation
Coskun, Erman and Baydar, Mevlut, "Selections of Software Quality Attributes: Joint Optimization Model for Customer Needs and Producers' Software Quality Expenditures" (2005). AMCIS 2005 Proceedings. 385.
https://aisel.aisnet.org/amcis2005/385