Showing 1 - 10 of 23
profit incentive and the competitive threat. This is illustrated using a simple duopoly model. This model is then used to …
Persistent link: https://www.econbiz.de/10005662122
Consider two sellers each of whom has one unit of an indivisible good and two buyers each of whom is interested in buying one unit. The sellers simultaneously set reserve prices and use second price auctions as rationing device. An equilibrium in pure strategies where each sellers has a regular...
Persistent link: https://www.econbiz.de/10005662147
We analyse an infinite-period model of duopolistic competition in a market with consumer switching costs, in which in every period new consumers arrive and a fraction of old consumers leaves. We show that prices (and profits) are higher than in a market without switching costs, and that this...
Persistent link: https://www.econbiz.de/10005792046
When a supply and demand model is recursive, with errors uncorrelated across the two equations, ordinary least squares …
Persistent link: https://www.econbiz.de/10005504667
do not occur ceteris paribus. This makes it necessary to explicitly account for the demand and supply shocks underlying …
Persistent link: https://www.econbiz.de/10011083294
UK to (i) document these differences; (ii) estimate a demand system for food and nutrients, and (iii) simulate …
Persistent link: https://www.econbiz.de/10011083438
improve quality is that providers will face higher demand if they improve their quality. We test this crucial assumption in an …
Persistent link: https://www.econbiz.de/10011084725
This paper provides evidence that learning about demand is an important driver of firms' dynamics. We present a simple … model with Bayesian learning in which firms are uncertain about their idiosyncratic demand parameter in each of the markets … their beliefs following a new demand shock, the younger they are. To test this learning mechanism, we make use of a specific …
Persistent link: https://www.econbiz.de/10011213311
We model the demand-pressure effect on prices when options cannot be perfectly hedged. The model shows that demand … option. Similarly, the demand pressure increases the price of any other option by an amount proportional to the covariance of … show that demand-pressure effects contribute to well-known option-pricing puzzles. Indeed, time-series tests show that …
Persistent link: https://www.econbiz.de/10005067592
In this paper I develop the Discrete Choice Analytically Flexible (DCAF) model of demand for differentiated products …. DCAF relaxes the constraints imposed on the matrix of own- and cross-price elasticities of demand by popular analytic …-price elasticities of demand. Under well defined constraints on the parameters, which may or may not be imposed in estimation, DCAF is …
Persistent link: https://www.econbiz.de/10005656174