We argue that when innovation is sequential (so that each successive invention builds in an essential way on its predecessors) and complementary (so that each potential innovator takes a different research line), patent protection is not as useful for encouraging innovation as in a static...

Recent theoretical research on principal-agent relationships has emphasized incentive problems that arise when the parties involved are constrained by either asymmetric information or their inability to monitor each other's actions. Here we concentrate on the former constraint and consider the...

Firms sometimes try to "poach" the customers of their competitors by offering them inducements to switch. We analyze duopoly poaching under both short-term and long-term contracts assuming either that each consumer's brand preferences are fixed over time or that preferences are independent over...

We examine two reasons why a monopoly supplier of software may introduce more upgrades than is socially optimal when the upgrade is backward but not forward compatible, so users who upgrade reduce others' network benefits. One explanation involves a commitment problem: profits and social welfare...

We study monopoly pricing of overlapping generations of a durable good. We consider two sorts of goods: those with an active secondhand market and anonymous consumers, such as textbooks, and those with no secondhand market and consumers who can prove that they purchased the old good to qualify...

We propose a new theory of predation based on "signal-jamming." In our model the predator's characteristics are common knowledge, while the entrant is uncertain of his own future profitability. The entrant uses his current profit to decide whether to remain in the market, and the predator preys...