Showing 51 - 60 of 110
I analyze and compare the effects of sequential and simultaneous cheap-talk communication (e.g., preannouncement of entry) among privately informed potential entrants who then play a normal-form entry game. The first main result is that cheap-talk communication is powerful enough to enable the...
Persistent link: https://www.econbiz.de/10014111387
Extending Milgrom and Roberts (1982) we present an infinite horizon entry model, where the incumbent(s) may use the current price to signal its strength to deter entry. We show that, due to the importance of entrants' types on the post-entry duopoly/oligopoly profits, the incumbent(s) may want...
Persistent link: https://www.econbiz.de/10014066597
This paper provides a model of planned obsolescence in a competitive market. A feature of the model is that there are configurations where a firm cannot survive in the competitive market unless its product exhibits planned and known obsolescence. This form of obsolescence is complementary to...
Persistent link: https://www.econbiz.de/10014074090
Persistent link: https://www.econbiz.de/10007318775
We show that information exchange via disclosure is possible in equilibrium even when it is certain that whenever one party learns the truth, the other loses. The incentive to disclose results either from an expectation of disclosure being reciprocated -- the quid pro quo motive -- or from the...
Persistent link: https://www.econbiz.de/10014536985
In the model there are two types of financial auditors with identical technology, one of which is endowed with a prior reputation for honesty. We characterize conditions under which there exists a 'two-tier equilibrium' in which 'reputable' auditors refuse bribes offered by clients for fear of...
Persistent link: https://www.econbiz.de/10010332213
Customers of network commodities face coordination problems due to adoption externalities that give rise to multiple, Pareto-ranked equilibria. We investigate the extent to which the coordination problem can be resolved by inducement schemes when agents' preferences are private information....
Persistent link: https://www.econbiz.de/10014589023
Persistent link: https://www.econbiz.de/10005499569
An intuitively natural consistency condition for contingent plans is necessary and sufficient for a contingent plan to be rationalized by maximization of conditional expected utility. One alternative theory of choice under uncertainty, the weighted-utility theory developed by Chew Soo Hong...
Persistent link: https://www.econbiz.de/10005427771
An intuitively natural consistency condition for contingent plans is necessary and sufficient for a contingent plan to be rationalized by maximization of conditional expected utility. One alternative theory of choice under uncertainty, the weighted-utility theory developed by Chew Soo Hong...
Persistent link: https://www.econbiz.de/10005407612