This paper examines a marriage market with externality. We first develop an appropriate notion of stability for this market, called E-stability. We provide an example to show that an E-stable outcome need not exist. We then derive conditions under which an E-stable outcome exists.

For a large class of demand and cost functions, we characterize the limit equilibrium set under Bertrand oligopoly when entry is exogenous. Unless average cost is constant, we find that the folk theorem of perfect competition necessarily fails. We also relate our results to those in Novshek and...

We examine a model of price competition where the firms simultaneously decide on both price and quantity, and are free to supply less than the quantity demanded. We demonstrate that if the tie-breaking rule is `non-manipulable', then, for a large class of rationing rules, there is a unique...

We examine a simple model of collusion under a single-object secondprice auction. Under the appropriate parameter conditions, in particular as long as collusion is neither too easy, nor too difficult, we find that the optimal policy involves both an effective ceiling, as well as a reserve price...

This paper focuses on the dynamic aspects of group-lending, in particular sequential financing and contingent renewal. We examine the encacy of these two schemes in harnessing social capital. We find that, for the appropriate parameter configurations, there is homogenous group-formation so that...

We develop a simple model of group-lendingbased on peer monitoring and moral hazard. We find that, in the absence of sequential financing or lender monitoring, group-lending schemes may involve under-monitoring with the borrowers investing in undesirable projects. Moreover, under certain...

We examine alliances between asymmetric countries. We find that the results depend on the nature of the equilibrium. If the equilibrium is an interior one then, with an increase in asymmetry, the level of the alliance-wide defense good decreases and the divergence between the first best and the...

This paper examines whether integration of national markets fosters innovation in the technologically inferior country. In a simple set up where a technologically backward home firm and a technologically advanced foreign firm compete in qualities and prices in an integrated market, we find that...

Consider a Bertrand-Edgeworth duopoly with linear cost functions. If the firms produce to stock then no Nash equilibrium in pure strategies exists. If, however, the firms produce to order then all subgame perfect Nash equilibria involve the firms charging a price equal to marginal cost.

This paper studies a non-cooperative bargaining problem with one buyer and many sellers, focussing on the tension between the complementarity intrinsic to such a setup and efficiency. We address this problem in a very general setup with a technology that allows for variable degrees of...