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This paper contributes to Hübler (2008) who analyses a partial equilibrium model of outsourcing with Cournot … manufactured by a Western (outsourcing) or Eastern European supplier (offshore outsourcing). The paper asks the question how … regions. -- Offshoring ; outsourcing ; Cournot competition ; intermediate goods ; high-skilled ; low-skilled …
Persistent link: https://www.econbiz.de/10003929209
We consider a downstream duopoly model with a monopolistic common supplier and mutual outsourcing between the two … incorporate managerial delegations into the duopoly model because deciding on organizational forms within a firm is critical to …
Persistent link: https://www.econbiz.de/10012793529
Using decentralized Nash bargaining with two-part tariff under mutual outsourcing between symmetric downstream firms … the mutual outsourcing has become a common business practice in technology intensive industries. We show that asymmetric …
Persistent link: https://www.econbiz.de/10014358611
Economic theory on the subject of barriers to entry focuses almost exclusively on firms seeking to preserve market power and economic profits. In this paper, we propose that, under certain circumstances, firms may instead choose to reduce barriers to entry as a profit-maximizing mechanism. We...
Persistent link: https://www.econbiz.de/10012968455
Persistent link: https://www.econbiz.de/10010338120
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In this paper we show how an upstream firm can prevent destructive competition among downstream firms producing relatively close substitutes by implementing a price-dependent profit-sharing rule. The rule also ensures that the downstream firms undertake investments which benefit the industry in...
Persistent link: https://www.econbiz.de/10010264075
The seminal paper by Salant, Switzer and Reynolds (1983) showed that merger in a standard Cournot framework with linear demand and linear costs is not profitable unless a large majority of the firms are involved in the merger. However, many strategic aspects matter for firm competition such as...
Persistent link: https://www.econbiz.de/10010261187
We study ex post outsourcing of production in an imperfectly discriminating contest, interpreted here as a research … tournament or a procurement contest for being awarded some production contract. We find that the possibility of outsourcing …, outsourcing reduces the procurement costs of inducing a given level of effort if the contest organizer can collect entry fees …
Persistent link: https://www.econbiz.de/10010261411
This paper analyzes the design of innovation contests when the quality of an innovation depends on the research approach of the supplier, but the best approach is unknown. Diversity of approaches is desirable because it generates an option value. In our main model with two suppliers, the buyer...
Persistent link: https://www.econbiz.de/10011410264