Predation occurs when a firm offers consumers favorable deals, usually in the short run, that get rid of competition and thereby harm consumers in the long run. Modern economic theory has shown how commitment or collective-action problems among consumers can lead to such paradoxical effects.But...

We consider a problem in which a buyer has private information about the efficient scale or nature of a relationship-specific investment by a producer. We show that reducing the producer's ex post bargaining power may enhance efficiency by providing incentives for the buyer to reveal his private...

This paper was prepared as a companion to the Mattioli Lectures delivered by Hal R. Varian, “Economics of Information Technology,†available at: http://www.sims.berkeley.edu/~hal/Papers/mattioli/mattioli.pdf. Professor Varian’s overview analyzes a variety of competitive...

We analyze patent licensing by a patent holder to downstream technology users. We study how the structure and level of royalties depends on the patent’s strength, i.e., the probability it would be upheld in court. We examine the social value of determining patent validity before...

Introduction: Market definition analysis, which is often central in merger cases, usually claims to follow the 1992 Horizontal Merger Guidelines issued by the U.S. Department of Justice and the Federal Trade Commission (“Guidelinesâ€). The Guidelines describe a relevant product market...