This paper studies the implications of various contracting alternatives between exporting and importing firms on the value of production and international transactions. Since contracts are usually determined when exchange rate is uncertain, we show that under some conditions renegotiating these...

This paper examines the impact of the presence of a forward exchange market on the financial and operational decisions of a multinational firm. The study concentrates especially on the effects of increased uncertainly and increased risk aversion on the part of the multinational firm. It is shown...

In this article, we investigate how the interplay of competition among incumbents and the magnitude of a potential entrant's setup cost determines the configuration of the array of products to be offered in a perfect Nash equilibrium. We show that incumbents can use limit qualities to deter...

A monopolist that sells in a market in which consumers differ in their willingness to pay for qua lity will distort and enlarge the range of products offered for sale. The authors examine the positive and normative impacts of remedies u sed to counteract such distortions. For the case of a price...

During the last decade the extent of inward foreign direct investment (FDI) in the United States has increased dramatically. An important aspect of industries where most FDI takes place is their high level of concentration. This paper investigates how strategic interactions among domestic and...

This paper provides an explanation for the choice of currency of invoice of exports to the US. We find an empirical relationship between the riskiness of the exchange rate and the fraction of imports invoiced in the importer's currency, the exporter's currency, and a third country currency. The...