This paper develops a theoretical foundation for the undercut-proof equilibrium (see Shy, 1996, 2002; Morgan and Shy, 2013). In a general spatial setting, the set of undercut-proof prices is equivalent the core of a non-transferable utility coalitional-game, played on the set of outcomes that are...

This study identified five Australian housing markets that could be made more efficient using online technology to match highly specific ‘buyers' and ‘sellers'. The five markets considered are: swaps in public housing; disability accessible housing; low-cost private rental housing brokerage;...

Where a manager's actions are “costless” and influence firm risk, the manager's career concerns give rise to moral-hazard. The optimal contract cannot be found using the standard techniques as the Monotone Likelihood Ratio Condition does not hold. This difficulty is resolved if an additional...

We augment the multi-market collusion model of Bernheim and Whinston (1990) by allowing for firm entry into, and exit from, individual markets. We show that this gives rise to a new mechanism by which a cartel can sustain a collusive agreement: Collusion at the extensive margin whereby firms...

We augment the multi-market collusion model of Bernheim and Whinston (1990) by allowing for firm entry into, and exit from, individual markets. We show that this gives rise to a new mechanism by which a cartel can sustain a collusive agreement: Collusion at the extensive margin whereby firms...

We provide a new model that generates persistent performance differences amongst seemingly similar enterprises. Our model provides a mechanism whereby efficient incumbent rivals can give permission for an inefficient firm to exist in the presence of efficient entrants. We demonstrate that, in a...

We augment the multi-market collusion model of Bernheim and Whinston (1990) by allowing for firm entry into, and exit from, individual markets. We show that this gives rise to a new mechanism by which a cartel can sustain a collusive agreement: Collusion at the extensive margin whereby firms...

Combining the Hotelling line with the realistic assumption that markets contain finitely many consumers, produces a model of spatial competition that does not possess a Nash equilibrium in pure strategies. This paper characterises both the ex-ante stable mixed strategy Nash equilibrium and the...

Pure strategy Bertrand Nash equilibria do not typically exist for a number of simple market structures; two prominent examples are price competition with convex costs and spatial competition with finite buyers. This paper develops an alternative model of price formation. The model examines as a...

We provide a new model wherein firms of different productivities survive in an industry despite the threat of entry by high productivity firms. We demonstrate that an effi- cient incumbent has a unilateral incentive to establish a relational contract, softening price competition to strengthen...