This paper shows that vertical foreign direct investemt will reduce prices but the aggregate welfare effect is unambiguaously positive only under free market entry. Using a standard model of imperfect competition, we develop this result by considering two different cases. In the first case, the...

The paper examines the welfare effects of the development of an intermediate market. For this purpose I develop a model where such a market may arise endogenously. If integrated and unintegrated firms coexist in equilibrium, consumers do not benefit from the emergence of an intermediate market....

Aufgrund der derzeit breiten Einführung von Bachelor- und Masterstudiengängen sowie des zunehmenden Drucks vom Arbeitsmarkt sollte die Einführung von Angeboten zum Erwerb von Schlüsselkompetenzen möglichst schnell und flächendeckend erfolgen, wobei ein hoher Qualitätsstandard der Angebote...

This paper analyzes a simple, repeated game of simultaneous entry and pricing. We report a surprising property of the symmetric equilibrium solution: If the number of potential competitors is increased above two, the market breaks down with higher probability, and the competitive outcome becomes...

According to Stigler (1951), vertical disintegration should be the typical development in growing industries, vertical integration in declining industries. The basic argument is that firms will spin off production stages subject to increasing returns to scale in response to market growth. This...