In many cases consumers cannot observe firms' investment in quality or safety, but have only beliefs on the average quality of the industry. In addition, the outcome of the collective investment game of the firms may be stochastic since firms cannot control perfectly the technology or external...

We present a theoretical model in tourism economics, assuming that the market for tourism is an oligopoly with differentiated products. Destinations (i.e., countries, regions, sites or even firms) can invest in order to improve their carrying capacity that can be interpreted as the stock of...

In this paper we look at both the theoretical and empirical behaviour of price-cost margins when capital market imperfections affect firms' markup policies. We present a model of a firm operating in an industry with differentiated products and facing imperfect markets for financing operations....

We study a discrete time dynamic game of price competition with spatially differentiated products and price adjustment costs. We characterise the Markov perfect and the open-loop equilibrium of our game. We find that in the steady state Markov perfect equilibrium, given the presence of...

The paper studies how does the size of a cartel affect the possibility that its members can sustain a collusive agreement. I obtain that collusion is easier to sustain the larger the cartel is. Then, I explore the implications of this result on the incentives of firms to participate in a cartel....

In a duopoly industry with environmentally differentiated products, we examine the effects of introducing a mandatory environmental quality standard on firms' environmental quality choices, profits, and the average environmental quality offered by the industry. We show that at low standard...

We develop a product-differentiated model where the product space is a network defined as a set of varieties (nodes) linked by their degrees of substitutability (edges). We also locate consumers into this network, so that the location of each consumer (node) corresponds to her “ideal”...

Allowing firms to cooperate in their R&D is an industrial policy, which has received much attention in recent economics literature. Many of these contributions are based on the seminal analysis of d'Aspremont and Jacquemin (1988). We provide a general version of their model, which encompasses...

This paper analyses the problem of price discrimination in a market where consumers have heterogeneous preferences both over a horizontal parameter (brand) and a vertical one (quality). Discriminatory contracts are characterised for different market structures. It is shown that price dispersion,...

This paper shows that as long as the stock market has perfect foresight, some dividends are distributed, and incentives are paid more than once or are deferred, stock-related compensation packages are strong incentives for managers to support tacit collusive agreements in repeated oligopolies....