This article examines the incentive to merge in a Bertrand competition model with generalized substitutability and price competition. The model suggests that acquisition of firms by their rivals can result in maximal concentration of the industry.

In this paper, we extend the model of R and D network formation by Goyal and Moraga-Gonzàlez (2001) by allowing for imperfect spillovers among linked firms. We show that the complete network maximizes industry profit if spillovers for linked firms are below a threshold level. Furthermore, this...

This paper investigates the bargaining between owners and managers over their managerial delegation contracts, in order to explain the disclosure obligation that is central to many modern corporate governance codes. We consider the managerial incentive contracts based on the profit and sales of...

We again examine how the managers' bargaining power affects social welfare and the firms'' profits in both quantity and price competition, in particular, in the case where each firm''s production technology is represented by a quadratic cost function. We show that under both the competition...

This paper examines the bargaining problem between firms' owners and managers over their managerial delegation contracts in a duopolistic market with differentiated-products. Assuming that delegated managers make every managerial decision in the market, we analyze how the managers'' bargaining...

This note uses a three-stage delegation-licensing-quantity game to study the licensing of a cost-reducing innovation by a patent-holding firm to its competitor. It is shown that licensing is less likely to occur under strategic delegation compared to no delegation.

This paper studies an effect of a horizontal merger where a product consolidation by the merged firm may alter the substitutability in the industry. We show that as the number of firms in the industry increases, this type of merger becomes profitable for merging firms, while unprofitable for...

This paper investigates productivity improving merger activities between a public firm and a private firm in mixed oligopoly. We assume that the merged firm has two plants (formerly, firms). We show that both owners of a public firm and a private firm want to merge by coordinating their...

This note shows that when products are complements in the mixed duopoly market, both public and private firms choose excess capacity. This contrasts with substitute case, where public firm strategically chooses under-capacity while private firm keeps holding excess capacity.

In a vertically differentiated oligopoly, firms raise cost-reducing alliances before competing with each other. It is shown that heterogeneity in quality and in cost functions reduces individual incentives to form links. Furthermore, both differentiated Cournot and Bertrand competition...