In this paper we study how an exogenous expense of owning a market good affects the equilibrium outcome in a market with vertical product differentiation i.e. consumers differ by income but have identical preferences for the good’s quality. We identify three possible subgame-perfect...

Motivated by the failure of competition to emerge after the natural gas market in the Czech Republic was liberalized, I explore the impact of natural gas storage ownership and upstream competition on the downstream level. I extend standard Cournot models to understand current and likely future...

We compare the social welfare generated by a domestic government in the two types of policy setups: a "commitment" regime in which the government sets its policy instrument before the strategic choice is made by the domestic firm and a "non-commitment" regime where the policy variable is set...

We shift the usual perspective of strategic trade policy – the “third market setup” – to the “home market” framework in order to reconsider the consequences of government (in)ability to precommit to its policy and compare these findings with those analogous from the “third market...

This paper analyzes tying and bundling as an entry deterrence tool. It shows that a multi-product firm can defend its monopoly position in one market via tying even when it does not have market power in another market. This is shown on a model with two complementary goods, each of which is...

This paper explores tying in the situation where a multi-product firm without monopoly power competes against several single-product firms. I consider two markets: one for a horizontally differentiated good, the other for a homogeneous good. As opposed to the widely accepted opinion that tying...

We study the potential loss in social welfare and changes in incentives to invest in R&D that result when the market leading firm is deprived of its position. We show that under plausible assumptions like free entry or repeated market interactions there is a social value of market leadership and...

We introduce an intra-industry setup in order to reconsider the consequences of government (in)ability to precommit to its policies when it is constrained to only one policy instrument (second-best policies). This setup nests the standard frameworks of strategic trade policy—the...

Two software developers, each offering a product variety of different (exogenously given) quality, compete in prices for heterogeneous users who choose from purchasing a legal version, using an illegal copy, and not using a product at all. Using an illegal version violates intellectual property...

Economies have markedly different firm size distributions. At the same time, firms of different size grow differently after identical financial- and product-market liberalization reforms. Thus, identical reforms can produce different growth outcomes across countries. This result is reached after...