This article shows by example that when workers care about relative income and are free to choose their coworkers, the equilibrium distribution of wages within firms must be less dispersed than the corresponding distribution of marginal products. An implicit market for within-firm status is...

This article examines the nature of economically efficient tariffs when there exists rivalry among firms that produce imperfectly substitutable outputs with economies of scale and that operate under a viability constraint. Pricing principles are derived and related to the rules developed in the...

This article analyzes the duality of prices and quantities in a differentiated duopoly. It is shown that if firms can only make two types of binding contracts with consumers, the price contract and the quantity contract, it is a dominant strategy for each firm to choose the quantity (price)...

In markets with increasing returns to scale in investment, competition will occur over both the amount and the timing of new capital construction. This article develops a theory of competition in markets with indivisible and irreversible investments. The consequences of competition depend on the...

Data on 37 chemical products are used to test a number of hypotheses about the learning curve and industrial price behavior. The results document a strong and consistent learning effect. Learning is found to be a function of cumulated industry output and cumulated investment rather than calendar...

It has recently been suggested in the agency literature that moral hazard in teams can be dealt with by introducing a third party who breaks the budget-balancing constraint, and that this facilitates the design of contracts that can sustain the Pareto optimum as a (perfect) Nash equilibrium....

This article extends previous laboratory experimental research to examine the competitive discipline of contested markets with a "natural monopoly"-type cost structure where sunk costs are neither zero nor infinite. Several alternative conjectures as to how or whether sunk costs can weaken the...

This article evaluates impact of asset salvageability on the profitability of restraint of trade through industrial combination. In the case of merger either for monopoly or market dominance, a postmerger price equal to the premerger, competitive price is proved a reasonable possibility. Even in...

This article considers a situation where the buyer or the seller of a good must engage in expenditures on specific capital before the exchange either to prepare to use the product or to prepare to sell it. It is assumed that postbreach bargaining is possible and carried out in a cooperative...

This article presents a theory of such phenomena as coupons valid for the next purchase of a good and high initiation fees for clubs. In these cases the price of a nondurable good is lowered for second-time buyers. We show here that this can be explained by a model in which a monopolist sells a...