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Two suppliers of a homogenous good know that, in the second period, they will be able to collude. Gains from collusion are split according to the Nash bargaining solution. In the first period, either of them is able to invest into process innovation. Innovation changes the status quo pay-off,...
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Two suppliers of a homogenous good know that, in the second period, they will be able to collude. Gains from collusion are split according to the Nash bargaining solution. In the first period, either of them is able to invest into process innovation. Innovation changes the status quo pay-off,...
Persistent link: https://www.econbiz.de/10010264811
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. It is routinely analysed in terms of game theory. Much less frequently, however, an obvious parallel is drawn. For cartel … at the theoretical and at the experimental levels. The paper contrasts oligopoly theory with public goods theory, and …
Persistent link: https://www.econbiz.de/10014058244
, theory even predicts that strategic interaction forces firms to set the market clearing price. For society, this would be …
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