Based on the assumption that location is especially relevant in the lodging industry, we exploit a dataset of Spanish hotels to examine the relationship between spatial competition and retail price level and dispersion. Our results support the hypothesis that a greater density of competitors...

The objective of this paper is to estimate technical efficiency in retailing; and the influence of inventory investment, wage levels, and firm age on this efficiency. We use the output supermarket chains¿ sales volume, calculated isolating the retailer price effect on its sales revenue. This...

This paper analyses the determinants of interest margins of the banking firms.Our starting point is the methodology developed in the original study by Ho andSaunders (1981) and later extensions, but widened to take banks¿ operating costsexplicitly into account. In the developed model the...

I analyze the implications of bundling on price competition in a market with complementary products. Using a model of imperfect competition with product differentiation, I identify the incentives to bundle for two types of demand functions and study how they change with the size of the bundle....

In the last decade, the analytical progress achieved in the New Keynesian literature has been remarkable. Many of the early assumptions have been relaxed, leading to medium-scale macroeconomic models that are now able to capture many features of real-world data. Nevertheless, modern-day New...

I construct a model in which an oligopoly first invests in persuasive advertising in order to induce brand loyalty to consumers who would otherwise buy the cheapest alternative on the market, and then competes in prices. Despite ex-ante symmetry, at equilibrium, there is one firm which chooses a...

We consider an upstream firm selling an input to several downstream firms through observable two-part tariff contracts. Downstream firms can alternatively buy the input from a less efficient source of supply. We show that downstream mergers lead to lower wholesale prices. They translate into...

Salant et al. (1983) showed in a Cournot setting that horizontal mergers are unprofitable because outsiders react by increasing their output. We show that this negative effect may be compensated by the positive effect that horizontal mergers have on the buyer power of merging firms in input markets.

In this paper we get the optimal two-part tariff contract for the licensing of a cost reducing innovation to a differentiated goods industry of a general size. We analyze the cases where the patentee is an independent laboratory or an incumbent firm. We show that, regardless of the number of...

Competition has long been regarded as productivity enhancing. Understanding the mechanism by which competition affects innovation and productivity is therefore an important topic for economic policy. The main contribution of this paper is to disentangle the relationship between competition and...