In this paper we examine the role of policy when forming a R&D joint venture is costly. Contrary to previous studies, we document an active role for public policy, since the interests of firms are not necessarily aligned with societal interests. The nature of policy, however, depends on the...

The authors analyze the strategic pricing and informative advertising decisions made by firms in duopolistic contexts. They show that, whether the products are substitutes or complements, there exist strategic settings in which firms keep potential consumers uninformed about their products even...

This paper compares one-part and two-part pricing in a discrete-continuous choice model, providing more extensive welfare results than prior literature. Under two-part pricing, firms may set fixed fees with or without `unit-price commitment,' where the lack of unit-price commitment is consistent...

In order to analyze the welfare effects of price changes in input markets - following for example a price-fixing conspiracy - economists have studied the relationship between the surplus measured in the input markets and the surplus in the output markets. The latest results hinge on simplifying...

This study develops a model of trade that highlights the effects of the interconnection of country-specific communications networks as a driving force behind trade in high-tech products with positive transport costs. By constructing a two-country model of monopolistic competition with two...

Studies of the performance effects of public vs private ownership have found mixed evidence. This paper draws on theory suggesting that public enterprise may have an advantage in producing goods and services whose quality attributes are difficult to specify a priori. Using a comprehensive data...

Large distance and border effects on trade flows in some industries may result from the collusive division of geographic markets. In the Brazilian cement industry, traditional gravity equations fit the data well, yet limited regional flows are due to firms' strategic behaviour. Thanks to a...

Compared with the social optimum, a monopolist usually sells too little. This result seemingly includes the case of a lab that licences its patented cost innovation: <link>Katz and Shapiro (1986)</link> find `conditions under which &lsqb;the lab&rsqb; will issue fewer than the socially optimal number of licences.'...

This paper examines the joint pricing decision of products in a firm's product line. When products are distinguished by a vertical characteristic, those with higher values of that characteristic will command higher prices. We investigate whether, holding the value of the characteristic constant,...