Why would a durable good monopolist also produce a cost-inefficient nondurable good?

We develop both commitment and time-consistent stationary policies for a mo nopolist who produces a mixture of goods distinguished by production costs and degree of durability. Under commitment, only the cost-efficient durable good is produced and the monopoly output is realized each period. For the time-consistent stationary case, there is an interval for the degree of dur ability where only the durable good is produced and a higher, non-overlappi ng interval where both the cost-efficient durable and the cost-inefficient nondurable good are produced. For any period length, when the degree of dur ability is such that both durable and nondurable goods are provided, combin ed output is less than the competitive output and decreases in the degree o f durability, approaching the single-period monopoly output. When both good s are produced, the Cease conjecture does not hold. (C) 2000 Elsevier Scien ce B.V. All rights reserved.