We analyze the principle of comparative advantage when agents in the world market are aware of the influence their individual supply exerts on the equilibrium exchange rate of goods. We show that specialization following comparative disadvantage can be an oligopoly equilibrium in a Ricardian...

In this paper, we extend the concept of stability to vertical collusive agreements, involving downstream and upstream firms, using a setup of successive Cournot oligopolies. We show that a stable vertical agreement always exists: the unanimous vertical agreement involving all downstream and...

We model duopoly competition between two platforms.They operate in a two-sided market where agents are heterogeneous on both sides of the market and are allowed to mulithome. Network effects are captured within a vertical differentiation framework.Under single-homing there exists an interior...

While ordinal complementarity is more general than cardinal complementarity, the corresponding global sufficient conditions placed on the primitives of a constrained optimization problem are generally not comparable. We explore this issue in detail for the special case of a Cournot firm. We...

In this paper we develop a model of a vertically differentiated industry where the production of higher quality goods needs a higher fraction of specialized labour. In the first stage, firms choose the quality of their products, in the second, both good prices and skilled workers’ wages are...

When the production of high quality goods needs the employment of qualified labour, firms’ decisions concerning quality are affected by the extent to which skills are abundant. By means of a comparison between monopoly and perfect competition, we show how market power in such a context may...

This chapter considers a recent trend in the application of stochastic games to economics characterized by the use of the lattice-theoretic approach to capture the monotonic properties of Markovian equilibria. The topics covered are: (i) a general framework for discounted stochastic games with...

This survey provides an extensive account of research in economics based on the stochastic games paradigm. Its area-by-area coverage is in the form of an overview, and includes applications in resource economics, industrial organization, macroeconomics, market games, experimental and empirical...

We consider the issue of first versus second-mover advantage in differentiated-product Bertrand duopoly with general demand and asymmetric linear costs. We generalize existing results for all possible combinations where prices are either strategic substitutes and/or complements, dispensing with...

Amir and Lambson (2003) developed an infinite-horizon, stochastic model of entry and exit by integer numbers of firms facing sunk costs and uncertain market conditions. Here, as examples of the model' usefulness, special cases are applied to the following three s issues: (1) the relationship...