This paper shows the possibility that, under certain conditions, it can be socially optimal for the public firm not to privatise its whole production capacity but to retain a part of it, even when private operation of the production facilities is strictly more cost-efficient than public operation.

This paper studies a strategic market game where agents fragment their bids on different markets. Simple conditions for existence of an interior equilibrium point are provided. In equilibrium, all agents are active on the same markets and prices are identical across markets, so that all...

We study the development of an industry-evolution of capacity, production and prices- in a continuous-time real-options model under various assumptions on competition. Investment takes the form of sequential acquisition of indivisible units of capacity. As benchmarks, we determine the optimal...

This paper investigates the endogenous choice between price- and quantity-setting behaviour in a duopoly game where firms invest in product development first, and then play a marketing game later. Only in the initial R&D stage, the two firms set up a joint venture in order to share the costs of...

In an oligopoly supergame, firms' actions in prices and quantities are subject to non-negativity constraints. These constraints can obstruct the practicability of optimal punishment (a la Abreu (1986), Lambson (1987), and Hackner (1996)) in sustaining tacit collusion. Noting that the prospect of...

The endogeneity of equilibrium strategies makes modelling uncertainty about the behaviour of other economic players difficult. Recent developments in decision and game theory offer an opportunity to include strategic uncertainty as an explanatory variable in economic analysis. This paper...

This is a preliminary version of a prospective book which springs from concerted effort among several researchers in the fiels of industrial economics. This chapter is devoted to the strategic role of information in oligopoly, and more broadlyn, in monotone games in general.

This paper considers a model of oligopolistic competition and locational choice that incorporates the notion of regional industrial systems. Firms play a non cooperative game where the strategy set of firms is given by a set of existing industrial districts. Each firm is distinguished by its...