We develop a model of interlocking bilateral relationships between upstream manufacturers that produce differentiated goods and downstream retailers that compete imperfectly for consumers. Contract offers and acceptance decisions are private information to the contracting parties. We show that...

We study a nonexclusive insurance market with adverse selection in which insurers compete through simple contract offers. Multiple contracting endogenously emerges in equilibrium. Different layers of coverage are priced fairly according to the types of insurees who purchase them, giving rise to...

The recent subprime crisis and the ongoing Euro zone crisis have generated an enormous interest in the credit rating industry not only among economists but also among average citizens. As a consequence, we have seen an explosion of the economic literature on the industry. The objective of this...

In a common agency setting, where the common buyer undertakes cooperative investment with her suppliers, we obtain a direct link between the level of ex-post competition and investment which affects the market structure of the supply side of the market. We show that more competitive equilibria...

This paper analyzes how the stability of the tacit cooperation within a fringe of sev- eral identical ?rms is a¤ected by the presence of a more e¢ cient ?rm which does not take part in their cooperative agreement. The model assumes that the ?rms of the fringe adopt ?stick and carrot?strategies...

Two-period Cournot competition between n identical firms producing at constant marginal cost and able to store before selling has pure strategy Nash- perfect equilibria, in which some firms store to exert endogenously a leader- ship over rivals. The number of firms storing balances market share...

We propose an approach to restricting the set of equilibria in a market game and use it to assess the robustness of the price dispersion results obtained by Koutsougeras [2003, J. Econ. Theory 108, 169–175] in the multiple trading posts setup. More precisely, we perturb the initial game by the...

We study how the presence of a news aggregator affects quality choices of newspapers competing on the Internet. To provide a microfoundation for the role of the aggregator, we build a model of multiple issues where each newspaper chooses quality on each issue. This model captures the...

In this paper we propose estimates of the marginal cost of public funds (MCF) in 38 African countries. We develop a simple general equilibrium model that can handle taxes on five major tax classes, and can be calibrated with little more than national accounts data. Our base case estimate of the...