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Eliaz, Kfir; Spiegler, Ran - C.E.P.R. Discussion Papers - 2004

A principal contracts with agents who have diverse abilities to forecast changes in their future tastes. While the principal knows that the agent’s tastes are changing, the agent believes that with probability ?, their future preferences will be identical to their present preferences. The...

Persistent link: https://www.econbiz.de/10005504207

Coordination and Lock-In: Competition with Switching Costs and Network Effects

Farrell, Joseph; Klemperer, Paul - C.E.P.R. Discussion Papers - 2006

Switching costs and network effects bind customers to vendors if products are incompatible, locking customers or even markets in to early choices. Lock-in hinders customers from changing suppliers in response to (predictable or unpredictable) changes in efficiency, and gives vendors lucrative ex...

Persistent link: https://www.econbiz.de/10005124423

How Strong Buyers Spur Upstream Innovation

Inderst, Roman; Wey, Christian - C.E.P.R. Discussion Papers - 2005

We challenge the view that the presence of powerful buyers stifles suppliers' incentives to innovate. Following Katz (1987), we model buyer power as buyers' ability to substitute away from a given supplier and isolate several effects that support the opposite view, namely that the presence of...

Persistent link: https://www.econbiz.de/10005136445

Selling to a cartel of retailers: a model of hub-and-spoke collusion

Sahuguet, Nicolas; Walckiers, Alexis - C.E.P.R. Discussion Papers - 2013

This model describes the working of hub-and-spoke collusion that has been discussed recently by competition policy authorities. We develop a model of tacit collusion between a manufacturer and two retailers, competing a la Rotemberg and Saloner (1986). The best collusive equilibrium between...

Persistent link: https://www.econbiz.de/10011083474

Exclusive Dealing and Vertical Integration in Interlocking Relationships

Nocke, Volker; Rey, Patrick - C.E.P.R. Discussion Papers - 2014

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

Persistent link: https://www.econbiz.de/10011084283

Vertical Product Differentiation and Entry Deterrence

Lutz, Stefan - C.E.P.R. Discussion Papers - 1996

This paper studies how the existence of a potential entrant influences an incumbent’s choice of quality in a model of vertical product differentiation and entry. Both firms face fixed set-up costs and quality-dependent costs of production, and compete on quality and price. With identical...

Persistent link: https://www.econbiz.de/10005504715

Should Mergers Be Controlled?

Fridolfsson, Sven-Olof; Stennek, Johan - C.E.P.R. Discussion Papers - 2001

' incentives to merge (a hold-up mechanism). Firms delay merger proposals, thereby foregoing valuable profits and hoping other … demonstrate a surprising inter-temporal link. Merger incentives may be reduced by the prospect of additional profitable mergers in … the future. The prospect of a future merger increases the value of becoming an insider in the first merger, which tends to …

Persistent link: https://www.econbiz.de/10005788894

On the Uniqueness of Optimal Prices Set by Monopolistic Sellers

den Berg, Gerard J van - C.E.P.R. Discussion Papers - 2005

This paper considers price determination by monopolistic sellers who know the distribution of valuations among the potential buyers. We derive a novel condition under which the optimal price set by the monopolist is unique. In many settings, this condition is easy to interpret, and it is valid...

Persistent link: https://www.econbiz.de/10005789129

Exclusive dealing: the interaction between foreclosure and investment promotion

Fumagalli, Chiara; Motta, Massimo; Rønde, Thomas - C.E.P.R. Discussion Papers - 2009

This paper studies a model where exclusive dealing (ED) can both promote investment and foreclose a more efficient supplier. While investment promotion is usually regarded as a pro-competitive effect of ED, our paper shows that it may be the very reason why a contract that forecloses a more...

Persistent link: https://www.econbiz.de/10005789156

Parallel Trade, International Exhaustion and Intellectual Property Rights: A Welfare Analysis

Szymanski, Stefan; Valletti, Tommaso - C.E.P.R. Discussion Papers - 2005

This paper analyses the issue of parallel trade (arbitrage) for products protected by intellectual property rights. Many countries have traditionally allowed owners of intellectual property rights to prohibit arbitrage in the face of international price discrimination. In a well-known paper...

Persistent link: https://www.econbiz.de/10005791206