In a differentiated oligopoly market, it is often the case that consumer’s ex post preferences over different product qualities depend upon the state of nature which is not yet observable to the consumers at the time of purchase. One of the most typical examples is a market for durable goods...

This paper considers entry into a market with two incumbents where one prefers and one dislikes entry. Unlike the entrant both incumbents know market demand. One would like to signal high demand, the other low. In separating equilibria incumbents choose full information Nash-equilibrium...

Danish ready-mixed concrete is produced in regional oligopolies. Firms rely on price discrimination through secret discounts. The antitrust authority interprets this as lack of competition and has decided to activate its chief weapon against dormant competition: To make the market more...

A framework is developed with which both R&D-subsidies and R&D-cooperatives can be analyzed. It is shown that in most cases providing R&D-subsidies is more effective in promoting private R&D than allowing for an R&D-cooperative. Moreover, considering the implementation of both R&D stimulating...

We characterize the interplay between firms’ decision in terms of product differentiation and the nature of their ensuing market behaviour. We prove the existence of a non-monotone relationship between firms’ decision at the development stage and their intertemporal preferences.

Advance production serves as a means of quantity commitment. Therefore, a quantity-competing firm may have an incentive to invest in advance production in order to pre-empt its opponent(s), even when [i] it is technologically more costly than on-spot production, and [ii] it does not entitle the...

In recent years much attention has been paid to especially entry studies within industrial organisation research. Firm mobility is important in order to move resources towards the most productive industries, and the threat from potential entrants can restrain the incumbents from exploiting their...

We explore how an incumbent airline firm structures its route network under the threat of entry caused by deregulation. We show that entry induces the incumbent firm to strategically alter its flight operating network from a fully connected network (FC) to a hub-and-spoke network (HS). While...

This paper explores an algorithm which serves as a market auctioneer under the following constraints: [i] traders arrive randomly and each sales/purchase order should be executed at the currently posted price (sequential service), [ii] the auctioneer need not know the exact fundamental value of...

Different market settings are considered in a free trade environment, where firms can choose technology, quality, and price or quantity. The shape of competition in prices requires the intervention of governments, via a common antidumping policy to make firms converge on the simultaneous...