This paper analyses the incentives to upgrade input quality in vertically related (network) industries. Upstream investments have a biased effect on the downstream companies and lead to vertical product differentiation. Different vertical structures such as vertical integration, ownership and...

We build a simple formal model of governance. Investments and control rights over assets and labor are fully contractible, but final production decisions are ex ante uncontractible, and ex post negotiations are inefficient. If sunk costs are low, suppliers own assets and trade takes the form of...

The paper redefines different types of vertical market structure, such as double monopoly, bilateral monopoly, and two-sided monopoly. The core issue can be stated as follows: When there is bilateral monopoly, what are the differences between two-sided monopoly and one-sided monopoly as far as...

This paper develops a model of exchange between a single buyer and seller with simultaneous non-cooperative choices of a mark-up and a mark-down. These choices arise as optimal responses to uncertainty, if strategic and sales decisions are separate functions within the fi rm. There are multiple...

We study an industry in which an upstream monopolist supplies an essential input at a regulated price to several downstream firms. Legal unbundling means that a downstream firm owns the upstream firm but this upstream firm is legally independent and maximizes its own upstream profits. We allow...

We study an industry with a monopolistic bottleneck (e.g. a transmission network) supplying an essential input to several downstream firms. Under legal unbundling the bottleneck must be operated by a legally independent upstream firm, which may be partly or fully owned by an incumbent active in...

This paper is an annual publication issued by the Microeconomic Analysis service of the National Bank of Belgium. The Flemish maritime ports (Antwerp, Ghent, Ostend, Zeebrugge), the Autonomous Port of Liège and the port of Brussels play a major role in their respective regional economies and in...

This paper is an annual publication issued by the Microeconomic Analysis service of the National Bank of Belgium. The Flemish maritime ports (Antwerp, Ghent, Ostend, Zeebrugge), the Autonomous Port of Liège and the port of Brussels play a major role in their respective regional economies and in...

This paper is an annual publication issued by the Microeconomic Analysis service of the National Bank of Belgium. The Flemish maritime ports (Antwerp, Ghent, Oostende, Zeebrugge), the Autonomous Port of Liège and the port of Brussels play a major role in their respective regional economies and...

This paper is an annual publication issued by the Microeconomic Analysis service of the National Bank of Belgium. The Flemish maritime ports (Antwerp, Ghent, Ostend, Zeebrugge), the Autonomous Port of Liège and the port of Brussels play a major role in their respective regional economies and in...