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.

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...

The aim of this work is to test the Gibrat's Law hypothesis for Brazilian firms. Gibrat''s Law establishes that firm growth is a random walk, it means that the probability of a given proportionale change in size during a specified period is the same for all firms in a given industry. This work...

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 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...

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 models a dynamic innovation process to examine the relationship between levels of R and D and market structure. In contrast to most of the literature, here R and D increases firms' knowledge stocks, making future R and D less costly. This s a feedback by which market structures can...

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...