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By developing a linear model in a two-country framework of international price competition, we show how the degree of product differentiation and the cross-country distribution of private firms affect the strategic privatization choices made by governments concerned with their own country’s...
Persistent link: https://www.econbiz.de/10011785057
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The paper proves the existence of a subgame perfect Nash equilibrium in a vertically differentiated duopoly with uncovered market, for a large set of symmetric and asymmetric distributions of consumers, including, among others, all logconcave distributions. The proof relies on the 'income share...
Persistent link: https://www.econbiz.de/10011713762
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The paper analyses the effects of income concentration on the behaviour of a duopoly with vertical product differentiation and uncovered market. By using a trapezoid distribution, we solve explicitly for market equilibrium as a function of a mean preserving spread of the income distribution. We...
Persistent link: https://www.econbiz.de/10014055812
In "The Economics of Imperfect Competition", Joan Robinson argued that an increase of the consumers' incomes should make demand less elastic - which, although reasonable about individual demand as an assumption on preferences, suggests a role for income distribution as far as market demand is...
Persistent link: https://www.econbiz.de/10014070364
Income distribution affects demand and its elasticity, and, as a consequence, the optimal behaviour of firms and market equilibrium. This paper focuses on the effects of income polarisation, and presents a model where - for any unimodal density function describing income distribution of the...
Persistent link: https://www.econbiz.de/10014114059
The paper proves the existence of a subgame perfect Nash equilibrium in a vertically differentiated duopoly with uncovered market, for a large set of symmetric and asymmetric distributions of consumers, including, among others, all logconcave distributions. The proof relies on the 'income share...
Persistent link: https://www.econbiz.de/10013009867
We introduce non-homothetic preferences in the Dixit-Stiglitz model of monopolistic competition, and enquire about the effects of a change in income dispersion on the firms' optimal decisions and market equilibrium. Income dispersion, modeled as a mean preserving spread, is shown to affect only...
Persistent link: https://www.econbiz.de/10014063717
We introduce non-homothetic preferences in the Dixit-Stiglitz model of monopolistic competition, and enquire about the effects of a change in income dispersion on the firms' optimal decisions and market equilibrium. Income dispersion, modelled as a mean preserving spread, is shown to affect only...
Persistent link: https://www.econbiz.de/10014075274