Janssen and Rasmusen (2002) show that a Bertrand model with an uncertain number of firms has only one symmetric equilibrium, and profits in that equilibrium fit the empirical data in Bresnahan and Reiss (1991). However, unless its equilibrium is unique, Janssen and Rasmusen's model cannot be...

In this paper, we show that a firm that sells a bundle of complementary products will have a substantial advantage over rivals who sell the component products individually. Furthermore, this advantage increases with the size of the bundle. Once there are four or more items, the bundle seller...

This paper shows that bank competition has an intrinsically ambiguous effect on capital accumulation and economic growth. We further demonstrate that banking market structure can be responsible for the emergence of development traps in economies that would otherwise be characterized by unique...

In the context of production linkages in which downstream producers require freight services provided by transport operators, I show that the strategic choice of using an alternative transport mode does not necessarily induce lower access charges, relative to the standard transport mode....

The conventional wisdom is that the formation of patent pools is welfare enhancing when patents are complementary, since the pool avoids a double-marginalization problem associated with independent licensing. This conventional wisdom relies on the effects that pooling has on downstream prices....

We examine pollution-reducing R&D by a monopoly firm producing a dirty product. In a dynamic framework with hyperbolic discounting, we establish conditions under which the Porter hypothesis goes through, i.e. environmental regulation increases R&D, thus reducing pollution, as well as increasing...

The "revolving door" phenomenon has become very common in most industrialised countries, and is leading to conflicts of interest as well as economic distortions. The purpose of this paper is to develop an indicator of the distortionary effects of the revolving door - The Revolving Door Indicator...

Diversified firms often trade at a discount with respect to their focused counterparts. The literature has tried to explain the apparent misallocation of resources with lobbying activities or power struggles. We show that diversification can destroy value even when resources are efficiently...