Reputation or warranty, what is more effective against planned obsolescence?

Richard F. Hartl*, Peter M. Kort, Stefan Wrzaczek

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review


In determining the durability of its product a firm faces a trade off. Performing a policy of planned obsolescence by making their products less durable implies that the consumer needs to replace them earlier, which thus enhances demand. However, a lower quality of the product will result in a lower reputation, which in turn will affect demand negatively. In many cases, the government protects the consumer by implementing a warranty period. Our paper studies how a firm should optimally deal with this trade off and react to government policy. We obtain the following results. First, we find that the length of the warranty period has an inverted U-shaped effect on the product life time. Second, if more consumers are aware of the existence of a warranty period and ask for a free product replacement, this will increase the product life time. Third, increasing uncertainty about the breakdown of the product also has an inverted U-shaped effect on the product lifetime.
Original languageEnglish
Pages (from-to)939-954
JournalInternational Journal of Production Research
Issue number3
Publication statusPublished - Mar 2023


  • Planned obsolescence
  • warranty
  • product life cycle
  • quality management
  • optimal control
  • vintage structure


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