We here want to analyze how the imperfect competition mark-up and pass-through are transmitted through the production chain and how they change, as a function of the number of firms existing at each production stage. In order to have an analytical closed form solution, we use the standard linear...

Undertakings may restrict competition by cooperating with their competitors or by interfering with their ability to compete. In both cases, their ultimate goal is to raise the price they charge for their products or services. Therefore, the main concern about both collusive and exclusionary...

The paper studies the impact of homophily on the optimal strategies of a monopolist, whose marketing campaign of new product relies on a word of mouth communication. Homophily is a tendency of people to interact more with those who are similar to them. In the model there are two types of...

Under demand uncertainty, a risk-averse seller adopts marginal-cost pricing when clients are homogenous. When the clients are heterogeneous, the optimal unit price tends to move towards marginal cost as the seller's risk aversion increases and equals marginal cost if the seller is infinitely...

We present a diagrammatic and step-by-step analysis of price signaling quality. Because quality is a continuum on the real positive line, out-of-equilibrium beliefs need not be specified, i.e., every positive price is a positive outcome in equilibrium. We first study the behavior of the monopoly...

This paper studies two-part tariffs with explicit consideration of cost uncertainty and risk aversion. It finds that firms charge a risk premium over expected marginal cost for each unit they sell. This pricing rule is socially optimal if and only if the modeled market is fully covered in...

This paper explores a monopolist's optimal multi-tier quantity-discount prices and shows that only the last tier's marginal cost is relevant in determining the tier prices and each tier's price is equal to its preceding tier's marginal revenue. An increase in total output is associated with...

This survey aims to provide an overview of recent developments in the industrial organization literature that explores the behavior of profit-maximizing firms facing consumers with reference-dependent preferences and loss aversion. We discuss the implications of loss aversion on the practice of...

We provide a general definition of bundling that encompasses the bundling of two or more objects over sets of three or more objects. Bundled objects may be units of the same product, different products, or both. Such bundling encompasses a range of controversial pricing practices that have drawn...