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. Depending on the ratio of switching costs to network effects, our model generates convergence to monopoly as well as market … switching costs market sharing is the unique equilibrium and for small switching costs both monopoly and market sharing … equilibria emerge. We also analyze stationary and stable equilibria, where we show that a monopoly outcome is almost inevitable …
Persistent link: https://www.econbiz.de/10010265013
We present a model with firms selling (homogeneous) products in two imperfectly segmented markets (a high-demand and a low-demand market). Buyers are mobile but restricted by transportation costs, so that imperfect arbitrage occurs when prices differ in both markets. We show that equilibria are...
Persistent link: https://www.econbiz.de/10010271113
We present a model of takeover where the target optimally sets its reserve price. Under relatively standard symmetry restrictions, we obtain a unique equilibrium. The probability of takeover is only a function of the number of firms and of the insiders' share of total industry gains due to the...
Persistent link: https://www.econbiz.de/10010260718