Discussion:
Frank Perdue differentiated his chicken from other firms' chicken when he began marketing it under his name, thus create the Perdue brand. When Frank Perdue began marketing chicken under his name, the market for chicken was close to perfectly competitive.
Questions:
A. What did Perdue gain by differentiating his chicken in this way?
B. How did Perdue's differentiation eventually alter the market structure of the industry? What were the gains and losses to society through this differentiation?
C. Does the existence of product differentiation, particularly through advertising, imply that the government should intervene in these markets? Why or why not?
Copied and paraphrased from Carlton, Dennis W. and Perloff, Jeffery M. (2005): Modern Industrial Organization 4th ed.