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Strategic leaks in first-price auctions and tacit collusion : the case of spying and counter-spying

Fan, Cuihong; Chŏn, Pyŏng-hŏn; Wolfstetter, Elmar - 2021

We analyze strategic leaks due to spying out a rival’s bid in a first-price auction. Such leaks induce sequential bidding, complicated by the fact that the spy may be a counterspy who serves the interests of the spied at bidder and reports strategically distorted information. This ambiguity...

Persistent link: https://www.econbiz.de/10012507333

Fighting collusion by permitting price discrimination

Helfrich, Magdalena; Herweg, Fabian - 2016

We investigate the effect of a ban on third-degree price discrimination on the sustainability of collusion. We build a …' discount factor has to be higher in order to sustain collusion in grim-trigger strategies under price discrimination than under …

Persistent link: https://www.econbiz.de/10011434582

Induced price leadership and (counter-)spying rivals' play under incomplete information

Fan, Cuihong; Chŏn, Pyŏng-hŏn; Wolfstetter, Elmar - 2019

We analyze spying out a rival's price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

Persistent link: https://www.econbiz.de/10011962353

Collusion sustainability with a capacity constrained firm

Madio, Leonardo; Pignataro, Aldo - 2022

constrained. We show that collusion sustainability is non-monotonic in the size of the capacity constrained firm, which has little …

Persistent link: https://www.econbiz.de/10013473721

Strategic supply function competition with private information

Vives, Xavier - 2008

A Bayesian supply function equilibrium is characterized in a market where firms have private information about their uncertain costs. It is found that with supply function competition, and in contrast to Bayesian Cournot competition, competitiveness is affected by the parameters of the...

Persistent link: https://www.econbiz.de/10010264447

Strategic supply function competition with private information

Vives, Xavier - 2009

A finite number of sellers (n) compete in schedules to supply an elastic demand. The costs of the sellers have uncertain common and private value components and there is no exogenous noise in the system. A Bayesian supply function equilibrium is characterized; the equilibrium is privately...

Persistent link: https://www.econbiz.de/10010276986

Merger without cost advantages

Huck, Steffen; Konrad, Kai A.; Mueller, Wieland - 2005

The seminal paper by Salant, Switzer and Reynolds (1983) showed that merger in a standard Cournot framework with linear demand and linear costs is not profitable unless a large majority of the firms are involved in the merger. However, many strategic aspects matter for firm competition such as...

Persistent link: https://www.econbiz.de/10010261187

Induced Price Leadership and (Counter-)Spying Rivals' Play Under Incomplete Information

Fan, Cuihong - 2019

We analyze spying out a rival’s price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

Persistent link: https://www.econbiz.de/10012892109

Collusion Sustainability with a Capacity Constrained Firm

Madio, Leonardo; Pignataro, Aldo - 2023

constrained. We show that collusion sustainability is non-monotonic in the size of the capacity constrained firm, which has little …

Persistent link: https://www.econbiz.de/10014264158

Vertical integration and downstream collusion

Biancini, Sara; Ettinger, David - 2016

stakes of collusion. On the other hand, it creates an asymmetry between the integrated firm and the unintegrated competitors … cooperative equilibrium, which potentially harms collusion. As we show, the optimal collusive profit-sharing agreement takes care … the asymmetries in the non cooperative state. As a result, vertical integration generally favors collusion. …

Persistent link: https://www.econbiz.de/10011482885