In this paper we develop a spatial Cournot trade model with two unequally sized countries, using the geographical interpretation of the Hotelling line. We analyse the trade and welfare effects of international trade between these two countries. The welfare analysis indicates that in this...

In this note we analyze the incentives to merge in a mixed duopoly if firms compete in prices or quantities. Our model framework mainly follows Barcena-Ruiz and Garzon (J Econ 80:27–42, <CitationRef CitationID="CR1">2003</CitationRef>) who set up the model with quantity competition. We extend their analysis by analyzing the case of...</citationref>

This paper develops the incentives to collude in a model with spatially separated markets and quantity setting firms. We find that increases in transportation costs stabilize the collusive agreement. We also show that, the higher the demand in both markets the less likely will collusion be...

How should firms react to customer complaints after an unsatisfactory purchase? In a field experiment, we test the effect of different reactions and find that a cheap-talk apology yields significantly better outcomes for the firm than offering a monetary compensation.