We develop a tractable equilibrium model of competing firms in an industry to show how the distribution of firm qualities, moral hazard, and product market characteristics interact to affect firm size, managerial compensation, and market structure. Equilibrium effects cause different...

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...

In this paper, we undertake an in-depth inquiry into the nature of sharing externalities, and study how they affect the market outcome. We show that the key thing for understanding sharing externalities is the interplay between two forces: the specialization/complexity effect, on the one hand,...

We study a policy game between exporting and importing countries in vertically linked industries. In a successive international Cournot oligopoly, we analyse incentives for using tax instruments strategically to shift rents vertically, between exporting and importing countries, and horizontally,...

In this paper we investigate tax/subsidy competition for FDI between countries of different size when a domestic firm is the incumbent in the largest market. We investigate how the nature (public or private) of the incumbent firm affects policy competition between the two governments seeking to...

We develop a two-sector model of monopolistic competition with a differentiated intermediate good and variable elasticity of technological substitution. This setting proves to be well-suited to studying the nature and origins of external increasing returns. We disentangle two sources of scale...

We assess the consequences for consumers in 76 countries of multinational acquisitions in beer and spirits. Outcomes depend on how changes in ownership affect markups versus efficiency. We find that owner fixed effects contribute very little to the performance of brands. On average, foreign...

The dominance of English language content on the Internet raises a question of how consumer bilingualism in a given country affects the amount of home language content and the country's welfare. We address this question by studying two-sided market competition between a foreign and a domestic...

We study a policy game between exporting and importing countries in vertically linked industries. In a successive international Cournot oligopoly, we analyse incentives for using tax instruments strategically to shift rents vertically, between exporting and importing countries, and horizontally,...

This paper examines the strategic role of advertising subsidies in a third-country trade model in which two firms located in different countries export their products to a third country (Brander and Spencer (1985)). We first develop a basic model of advertising in oligopolistic industries in...