This paper explores how social interactions among consumers shape markets. In a two-country model, consumers meet and exchange information about the quality of the goods. As information spreads, the demands evolve, affecting the prices and quantities manufactured by profit-maximizing firms. We...

This paper explores how social interactions among consumers shape markets. In a two-country model, consumers meet and exchange information about the quality of the goods. As information spreads, the demands evolve, affecting the prices and quantities manufactured by profit-maximizing firms. We...

Signaling strategies which sellers of high quality securities, goods, or services employ to differentiate their securities or products from those of lower quality include: (1) developing a reputation for high quality, (2) certification by a respected third party (e.g., underwriters, bond rating...

In this paper, we tackle the dilemma of pruning versus proliferation in a vertically differentiated oligopoly under the assumption that some firms collude and control both the range of variants for sale and their corresponding prices, likewise a multiproduct firm. We analyse whether pruning...

We prove that a sufficient condition for the core existence in a n-firm vertically differentiated market is that the qualities of firms' products are equally-spaced along the quality spectrum. This result contributes to see that a fully collusive agreement among firms in such markets is more...

This paper introduces a number of game-theoretic tools to model collusive agreements among firms in vertically differentiated markets. I firstly review some classical literature on collusion between two firms producing goods of exogenous different qualities. I then extend the analysis to a...

In this paper, we tackle the dilemma of pruning versus proliferation in a vertically differentiated oligopoly under the assumption that some firms collude and control both the range of variants for sale and their corresponding prices, likewise a multiproduct firm. We analyse whether pruning...

The law and economics literature on the tragedy of the anticommons suggests that producers of complementary goods should integrate themselves. Recent decisions by the antitrust authorities seem to indicate that there is tradeoff between the “tragedy” and the lack of competition which might...

This paper examines the informativeness of consumer information networks and their effect on price competition between firms. Under the proposed information mechanism, consumers share their initial information with the members of their network and as such become better informed. The main result...