<heading id="h1" level="1" implicit="yes" format="display">Abstract</heading> We extend the literature on exclusive dealing by allowing the incumbent and the potential entrant to merge. This uncovers new effects. First, exclusive dealing can be used to improve the incumbent's bargaining position in the merger negotiation. Second, the incumbent finds it easier to...

We introduce stochastic R&D in the Hotelling model and show that if the technical risk is sufficiently high, all firms focus on the most valuable market segment. We then endogenize technical risk by allowing firms to choose between a safe and a risky R&D technology. Firms either both target the...

Two versions of a vertical product differentiation model, one with fixed and the other with variable costs of quality, are analyzed to study how the hypotheses of price versus quantity competition affect equilibrium solutions. Product differentiation arises under all the scenarios considered,...