Empirical implications for the variability of firm value in various models of industry evolution are discussed. Under certain conditions, learning models imply that industries with higher sunk costs should exhibit greater difference in firm value between entering and exiting firms whereas...

A supergame theoretic price-setting model of collusion is calibrated to data from the North American passenger car market before, during, and after the voluntary restraint arrangements (VRAs) with Japan. Conclusions about whether the model is consistent with the bans from the various regimes...

Profit rates differ across industries. Explanations have often relied on static models of imperfect competition. This paper develops a dynamic model of perfect competition to demonstrate that long-run average profit rates differ even across competitive industries when the effects of sunk costs...

Optimal penal codes are constructed for a class of infinity-repeated games with discounting. These games can be interpreted as Bertrand oligopoly games with capacity constraints. No particular rationing rule is adopted; weak restrictions are imposed on the firms' sales functions instead. Models...