We revisit the effects of switching costs on dynamic competition. We consider stationary Markovian strategies, with market shares being the state variable, and characterize a relatively simple Markov Perfect pricing equilibrium at which there is switching by some consumers at all times. For the...

Fjell and Heywood (2004) show that privatization is not necessarily welfare neutral in mixed oligopolies under a production subsidy if firms move sequentially. We find that the neutrality holds for any time structure if instead an output floor is introduced.

There is a dearth of research on the determinants of in-kind redistribution. Using dynamic panel data estimations for 32 OECD countries, we show that the in-kind share of social benefits is lower under left-wing governments. This effect is weakened when left-wing governments respond to inflation...

We argue that subsidized food distribution systems that fail to publicize how much food has been allocated to each local market will experience high rates of theft on the margin as they are expanded. We provide the first comparable cross-section of estimates of subsidized food theft. As...

We revisit the classic discussion of the endogenous choice of a price or a quantity contract, but in a mixed duopoly. We find that choosing the price contract is a dominant strategy for both firms, whether the goods are substitutes or complements.

We investigate a mixed oligopoly with misleading advertising competition. We find that, a welfare-maximizing public enterprise always engages in misleading advertising and that, an increase in the number of firms increases the profit and advertising level of each private firm.

The effects of free of charge state education on income distribution are often studied by allocating government education outlays to households, assuming that these outlays equal the benefit which households attach to state schooling. This paper proposes a demand analysis approach to estimating...

This study investigates the predictability of stock market returns using a novel corporate investment measure that captures the lumpiness of firm-level investment. We find that the proportion of firms with investment spikes ("spike") is a strong predictor of excess stock returns. Specifically,...

This paper sets up a three-stage (R&D, technology licensing, and output) oligopoly game in which only one of the firms undertakes a cost-reducing R&D and may license the developed technology to the others by means of a two-part tariff (i.e., a per-unit royalty and an upfront fee) contract. It is...

This paper builds a theory of endogenous role distribution (leader, follower, and Nash player) and of endogenous choice for the type of competition strategy (price and quantity) in a product differentiated duopoly model. We examine an extended game by adding a pre-play stage in which duopoly...