Collusion, competition and piracy

In this paper we analyze firms' ability to tacitly collude on pricesin an infinitely repeated duopoly game of vertical productdifferentiation. We show that firms collude if and only if their discountfactor is high enough, i.e. if they value future profits sufficiently. We alsoshow that a lower cost of copying facilitates collusion but that a higherquality of the copy hinders collusion. Thus, the overall effect of thesenew characteristics of copies made by consumers is ambiguous.

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Year of publication:	2009-01
Authors:	Martínez-Sánchez, Francisco
Institutions:	Instituto Valenciano de Investigaciones Económicas (IVIE)
Subject:	Collusion \| competition \| piracy \| consumers \| cost of copying

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Extent:	application/pdf
Series:	Working Papers. Serie AD.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Published by Ivie 14 pages
Classification:	D40 - Market Structure and Pricing. General ; K42 - Illegal Behavior and the Enforcement of Law ; L13 - Oligopoly and Other Imperfect Markets ; L40 - Antitrust Policy. General ; O34 - Intellectual Property Rights: National and International Issues
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005082634