We propose a general model of monopolistic competition, which encompasses existing models while being flexible enough to take into account new demand and competition features. Using the concept of Frechet differentiability, we determine a general demand system. The basic tool we use to study the...

This paper investigates the incentives to invest in improving the quality (as distinguished to investment in a new activity) in telecommunication industry using the empirical example of wireless markets. We highlight that investment incentives are positively related to the potential for...

Price discrimination is an extensively studied subject in monopoly behavior. Increasing profits, covering fixed cost and reducing distortions are reasons to sell a homogenous good at different prices. Price discrimination is however present also in oligopolistic markets. This paper is going to...

The relationship between technical progress and price competition is a controversial issue in economics. This paper highlights the fact that investment in technical progress is an authentic type of competition which benefits the consumers rather than the industry. This type of competition exists...

This paper investigates the impact of technical progress on the relationship between competition an investment. Using a model of oligopoly competition with differentiated products where firms invest to reduce their marginal cost of production, I find that technical progress, which increases the...

We examine the impact of self-learning Artificial Intelligence (AI) on firm competition in a growth model with endogenous labor supply and heterogeneous agents. AI possesses the ability to improve autonomously through application, testing, and training. When firms incorporate AI into their...

We examine welfare effects of real-time pricing in electricity markets. Before stochastic energy demand is known, competitive retailers contract with final consumers who exogenously do not have real-time meters. After demand is realized, two electricity generators compete in a uniform price...

This article provides a framework for the analysis of cartel formation. It models the strategic interaction among firms who invest into production capacity, sell a near-homogeneous good, and are subject to unexpected demand shocks with persistence. The firms either compete or collude in prices....

We consider a monopolistic supplier's optimal choice of wholesale tariffs when downstream firms are privately informed about their retail costs. Under discriminatory pricing, downstream firms that differ in their ex ante distribution of retail costs are offered different tariffs. Under uniform...