Recent work has investigated the effect of a potential entrant's uncertainty about postentry profits on the likelihood of his entering the market. It has always been assumed that the potential entrant knows the type of postentry solution, but lacks information on cost or as to whether the...

Around the turn of the century, a debate occurred within the infant U.S. electric power industry on the issue of electricity rate structures. We describe those discussions and consider the views of some of the economists who first addressed the issue. Although they were ultimately unsuccessful,...

Industrial entry deterrence is typically studied in a setting where an established firm or firms confront and attempt to deter a single potential competitor. During the evolution of most industries, however, a sequence of firms enters (or attempts to enter) at distinct points in time....

Using annual data on U.S. mergers from 1895-1979, we are not able to reject the hypothesis that merger levels are characterized by a white-noise process or by a stable first-order autoregressive scheme. This result contrasts with the common perception that mergers occur in "waves." Our results...

This article models a regulatory environment in which the regulated firm possesses better information about demand conditions than does the regulator. The regulator would like to tie prices to the firm's private information in a socially optimal way. To do so, the regulator must induce the firm...

A monopoly producer of a durable good is examined under the (previously uninvoked) assumption that the good depreciates, and hence that replacement sales must occur if a fixed stock of the good is to be maintained. We find two ways in which the no-depreciation result, that the monopoly will...

Tender offers provide an ideal setting for the analysis of agency relationships since the best interests of the principal (target firm shareholders) and agent (target firm managers) are often in conflict. Moreover, the actions and stated rationale of target managers in resisting or not resisting...

Resale price maintenance (RPM) has been applied to a number of products that do not seem to require tangible presale dealer services. This article explains why RPM might exist in these instances. We show that RPM will be adopted when a manufacturer wishes to "purchase" quality or style...

To inform debates about deregulation of wholesale markets for electricity, we estimate effective concentration in those markets in the contiguous United States in 1978. Our estimates are based on simulated oligopolistic equilibria, the characteristics of which are derived from a new and...

Recent theoretical research on principal-agent relationships has emphasized incentive problems that arise when the parties involved are constrained by either asymmetric information or their inability to monitor each other's actions. Here we concentrate on the former constraint and consider the...