Does free entry result in the socially preferred order of market entry for heterogeneous firms? This paper examines the welfare effects of sequential market entry by using a simple entry-deterrence model with heterogeneities in fixed and variable production costs among firms. In particular, we...

This is a discussion of Ratfai (2007), presented at the 2007 Macroeconomics Workshop of the Rimini Center for Economic Analysis on "The Macroeconomics of Price Setting," May 10-11, 2007, University of Bologna, Rimini, Italy.

This paper makes a pioneering attempt to provide a theory of determination of interest rate in the informal credit market in a small open economy in terms of a three-sector general equilibrium model. There are two informal sectors which obtain production loans from a monopolistic moneylender and...

In the following, we examine a market of a digital consumption good with monopolistic supply. In this market, it is the ability of the consumer to bypass (”crack”) the copy-protection of the monopolist which induces a lower price of the digital good, compared to an uncontested monopoly...

The article present a brief analyze of theoretical virtues of free competition in relation with some visible limits and negative consequences observed in real economic life. Social intervention to correct (at least in part) those social failures and the new responses of the firms are discussed...

The model presented here derives the product life cycle of durable goods. It is based on the idea that the purchase process consists of first purchase and repurchase. First purchase is determined by the market penetration process (diffusion process), while repurchase is the sum of replacement...

Information about a new or non-frequently purchased product is often produced by both sides of the market. We construct a monopoly pricing model consisting of both seller's information disclosure and consumer's information acquisition. The presence of consumer search, which lowers the...

The literature on the effects of market concentration in platform industries or two-sided markets often compares the competitive outcome against a benchmark. This benchmark is either the “joint management” solution in which one decision maker runs all platforms or a “pure” monopoly with...

Advertising is commonly regarded as a strategic tool to increase demand and steal business from competitors. The present work studies the competitive effects of advertising in a two-period game with incomplete information about the opponent's cost structure. Bagwell and Ramey (1988) showed that...

We analyse the roles of social network topology and size on the monopoly pricing of network goods in a market, where consumers interact with each other and are characterised by their social relations. The size effect is the well-known network externalities phenomenon, while the topological...