This paper compares profits and consumer surplus under non-cooperation and collusion in the product market when the firms have the option for R&D before production. We show that whether R&D investment would be higher under noncooperation or product market collusion depends on the R&D...

It is usually believed that the presence of a labour union makes firms as well as consumers worse off by increasing wages compared to the situation with no labour union. We show that the presence of a labour union may increase the incentive for entry and may also make consumers better off...

We show that the entry of private profit-maximising firms makes the consumers worse off compared to having a nationalised monopoly. Such entry increases the nationalised firm’s profit, industry profit, and social welfare, at the expense of the consumers. Our result is important for competition...