This paper reverses the standard order between input supply negotiations and downstream competition and assumes that competition for orders takes place prior to procurement of inputs in a vertical chain. In an environment where procurement negotiations involve no private information and no...

We analyse vertical integration when there is upstream competition and compare outcomes to the case where upstream assets are owned by a single agent (i.e., upstream monopoly). In so doing, we make two contributions to the modelling of strategic vertical integration. First, we base industry...

We take the view that alternative trading opportunities may influence the loss to delay in a bargaining situation, and show that contractual exclusivity may then be relevant even for ‘internal’ investments, contradicting a recent finding by Segal and Whinston (2000). When a buyer is an...

Congress enacted The Americans with Disabilities Act of 1990 over the protests of small business advocates who claimed that the ADA would trigger a wave of bankruptcies. Although the profitability of firms may suffer from the costs of ADA compliance, no systematic evidence is available on the...

Self regulation is a mechanism of quality vigilance that is frequently used in credence good industries. The providers in these markets generally form a Self Regulated Organization (SRO), composed by some members of the industry, whose main job is to convince consumers through an active...

It is widely speculated that the adoption of a technology takes off to be self-sustaining if it reaches the critical mass. However, the sponsors of competing technologies may engage in strategic maneuvering in the adoption process. Indeed, this paper shows that in the de facto standardization...

New technology is usually expensive and it takes time for manufacturers to make the technology more accessible. In the stereo industry, the first Super Audio Compact Disk (SACD) player made by Sony, SCD-1, sold for $5,000 in 1999; in 2002 the cheapest of Sony's new SACD players, SCD-CE775, had a...

This paper is concerned with the general question of the provision of information by financial intermediaries to their customers. Specifically, it analyzes the different ways the market can be organized and its effects on pricing and the level of information investors obtain. We find that market...

Sellers benefit on average from revealing information about their goods to buyers, but the incentive to exaggerate undermines the credibility of seller statements. When multiple goods are being auctioned, we show that ordinal cheap talk, which reveals a complete or partial ordering of the...

We examine a dynamic, durable goods model. A monopolist faces two types of consumers who value the monopolist’s goods differently. The quality of the good improves over time and an improvement is only valuable to consumers if they have previous improvements. In each period, the monopolist can...