This article tests the modell of Brander and lewis under ertrand and Cournot competition.

This paper reviews the Hotelling literature of product differentiation. The purpose of this work is to examine the impact of the market structure on price competitionand equilibrium differentiation. The existence of a general ’principle of differentiation’ is rejected. In contrast,...

This paper extends the standard Hotelling model with quadratic transport costs to the multi-firm case. Considering locational equilibria we show that neither holds the Principle of Maximum Differentiation - as in the duopoly model - nor does the Principle of Minimum Differentiation - as in the...

In many markets firms set posted prices which are potentially negotiable. We analyze theoptimal marketing mix of pricing and bargaining when price takers buy at posted prices butbargainers attempt to negotiate discounts. The optimal bargaining strategy involves the firmsoffering bargainers...

This paper examines the implications of “prominence” in search markets. We modelprominence by supposing that the prominent firm will be sampled first by all consumers.If there are no systematic quality differences among firms, we find that the prominentfirm will charge a lower price than its...

We compare the advertising intensity and content of programming in a market withcompeting media platforms. With pay-tv, media platforms have two sources of revenues,advertising revenues and revenues from viewers. With free-to-air, media platformsreceive all revenues from advertising. We show...

We consider the plant location decision of a multinational, which has the option to invest in a more or aless technologically advanced country. We find that in the absence of exporting by the local firms, themultinational will invest in the country lagging behind, unless the firms in that...

We analyze market dynamics under Bertrand duopoly competition in industries with network effects and consumer switching costs. Consumers form installed bases, repeatedly buy the products, and differ with respect to their switching costs. Depending on the ratio of switching costs to network...

Theoretically and experimentally, we generalize the analysis of acquiringa company (Samuelson and Bazerman 1985) by allowing for competition ofboth, buyers and sellers. Naivety of both is related to the idea that higherprices exclude worse qualities. While competition of naive buyers...

The common prior assumption justifies private beliefs as posterior probabilities when updatinga common prior based on individual information. Common priors are pervasive in most economicmodels of incomplete information and oligopoly models with asymmetrically informed firms. Wedispose of the...