Price vs. quantity competition in a vertically related market

This paper demonstrates that the standard conclusions regarding the comparison of Cournot and Bertrand competition are reversed in a vertically related market with upstream monopoly and trading via two-part tariffs. In such a market, downstream Cournot competition yields higher output, lower wholesale prices, lower final prices, higher consumers' surplus, and higher total welfare than Bertrand competition.

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Year of publication:	2014
Authors:	Alipranti, Maria ; Milliou, Chrysovalantou ; Petrakis, Emmanuel
Publisher:	Düsseldorf : Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)
Subject:	Cournot \| Bertrand \| vertical relations \| two-part tariffs

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Series:	DICE Discussion Paper ; 146
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
ISBN:	978-3-86304-145-8
Other identifiers:	785799699 [GVK] hdl:10419/96924 [Handle] RePEc:zbw:dicedp:146 [RePEc]
Classification:	D43 - Oligopoly and Other Forms of Market Imperfection ; L13 - Oligopoly and Other Imperfect Markets ; L14 - Transactional Relationships; Contracts and Reputation; Networks
Source:	EconStor

Persistent link: https://www.econbiz.de/10010352457