The article offers a complementary theory for conglomerate mergers. Conglomerate mergers take place to achieve control over distribution channels that otherwise could be used by rival entrants. An entrant with a very differentiated product is accommodated, and an entrant with a close substitute...

It is often asserted that agricultural land yields significant amenity benefits that could be used as a rationale for some of the substantial support to agriculture occuring in many industrialized countries. This paper introduces a method for incorporating information on the willingness to pay...

In this paper the author estimates the effect of the Helsinki agreement and economic factors on sulfur emissions using data from 25 European coutnries. To allow for self-selection into the agreement, a treatment effect model was estimated using the Heckman two-step procedure.

The paper studies the performance of joint ventures where upstream firms sell inputs to a production joint venture. It is found that joint ventures lead to overinvoicing of input prices (transfer prices) compared to integrated firms resulting in lower aggregate profits. Tax and tariff policy may...

In 1988, Becker and Murphy [Becker, G.S., Murphy, K.M., 1988 A theory of rational addiction. Journal of Political Economy, 96, 675-700.] launched a theory in which they proposed that the perspective of rational decision-making could be applied also to cases of addictive bahaviour. This paper...

In a setting with two differentiated producers and identical retailers, we analyzed whether the producers will have a distribution system with one or several retailers. In contrast to the existing literature, we allow for full foreclosure under both types of distribution systems.

In empirical productivity analysis it has become customary to use flexible functional forms to represent a firm's production technology by estimating cost functions. In this note we suggest a procedure to calculate the region where an estimated translog cost function meet the required...

It is well-known that switching costs may facilitate monopoly pricing in a market with price competition between two suppliers of a homogenous good, provided the switching cost is above some critical level. With heterogeneous consumers monopoly pricing entails second degree price dierentiotation...

Should the government procure equipment for its agencies or let them run their own procurment auctions? Suppose the agency has private information about product quality, but is inclined to favour local suppliers. Decentralization saves bureaucracy and "agency costs", but leads to biased...

Regulated firms are not necessarily willing to invest in cost minimizing technologies, but evaluate different technologies according to their impact on the information rent. In a two-type adverse selection model three kinds of investments are considered: investments that increase the probability...