Showing 71 - 80 of 21,313
The paper studies indirect network effects in a market composed by two incompatible intermediaries that choose price (short-term issue) in addition to location (long-term issue). The paper first shows that (i) when the network externality is sufficiently weak, only maximum differentiation...
Persistent link: https://www.econbiz.de/10010481985
This paper generalizes the frequently used Hotelling model for two-sided markets in order to determine the equilibrium market shares. We show that advertisement levels depend neither on the media price nor on the location of the media firm. An increase in advertising revenues does not change...
Persistent link: https://www.econbiz.de/10003872230
Two firms choose locations (non-wage job characteristics) on the interval [0,1] prior to announcing wages at which they employ workers who are uniformly distributed; the (constant) marginal revenue products of workers may differ. Subgame perfect equilibria of the two-stage location-wage game are...
Persistent link: https://www.econbiz.de/10003688783
In the framework of a vertically differentiated mixed duopoly, with uncovered market and costless quality choice, we study the existence of a price equilibrium when a welfare-maximizing public firm producing low quality goods competes against a profit-maximizing private firm producing high...
Persistent link: https://www.econbiz.de/10011714364
We analyze the effects of consumers' limited attention on welfare in a model of horizontal product differentiation. We present a novel approach of modeling limited attention: an attention radius. Each consumer only notices goods that are within her attention radius, i.e., goods that are...
Persistent link: https://www.econbiz.de/10012287658
This paper studies the entry decision of a multinational enterprise into a foreign market. Two alternative entry modes for a foreign direct investment are considered: Greenfield investment versus acquisition. In contrast to existing approaches, the acquisition price and the profits under both...
Persistent link: https://www.econbiz.de/10010440964
In spatial competition firms are likely to be uncertain about demand when launching products either because of shifting demographics or of asymmetric information about preferences. This paper considers two types of prices: those set on prior information and flexible prices which adjust across...
Persistent link: https://www.econbiz.de/10013128129
Hotelling's model, commonly referred to as the "linear city" model, is perhaps the most widely-used model of competition in differentiated products. However, pure-strategy Nash equilibria in prices do not exist unless the firms are located either sufficiently far apart from each other or at the...
Persistent link: https://www.econbiz.de/10013295976
This paper studies the implications of consumer misperception in a market for a (horizontally) differentiated product. Two distinct type of misperceptions are considered: (i) a common misperception that leads consumers to similarly overestimate the benefit from both firms' products; and (ii) a...
Persistent link: https://www.econbiz.de/10012868366
Combining the Hotelling line with the realistic assumption that markets contain finitely many consumers, produces a model of spatial competition that does not possess a Nash equilibrium in pure strategies. This paper characterises both the ex-ante stable mixed strategy Nash equilibrium and the...
Persistent link: https://www.econbiz.de/10012857921