Over the past twenty years, the study of industrial organization--the analysis of imperfectly competitive markets--has grown from a niche area of microeconomics to a key component of economics and of related disciplines such as finance, strategy, and marketing. This book provides an issue-driven...

I consider an infinite-period race where players choose between low- and high-variance motion technologies. I provide sufficient conditions under which, in equilibrium, the leader chooses a safe technology and the laggard a risky one, thus formalizing the sports intuition that the laggard has...

"The received wisdom is that sunk costs create a barrier to entry-if entry fails, then the entrant, unable to recover sunk costs, incurs greater losses. In a strategic context where an incumbent may prey on the entrant, sunk entry costs have a countervailing effect: they may effectively commit...

We study oligopoly price competition between multiproduct firms---firms whose products interact in the profit function. Specifically, we focus on the impact of intrafirm product interactions on the level of equilibrium profits. This impact may be decomposed in two different ways: (a) a direct...

Many new web-based services are introduced as free services. Depending on the seller’s business model, some remain free in the long run, while others switch to pay mode at some point in time. I characterize the relation between buyers and a new service seller when the former are uncertain...

I propose a novel explanation for new industry shakeouts: because of capacity sunk costs and the fear of backing the wrong technology, firms initially invest up to a small capacity, leading to a large number of initial entrants. As the dust settles and a dominant technology emerges, surviving...

We examine the consumer welfare effect of a firm's partial ownership of a competitor and compare the implications of alternative forms of divestiture. We identify conditions under which turning voting shares into non-voting shares is preferable to selling the shares to the firm's current...

I argue that dynamic oligopoly models are an area of industrial organization where much work needs to be done and much work can be done. In some particular settings (e.g., network industries), dynamic oligopoly models provide sensible answers when static models fall short of doing so.

I revisit the issue of aftermarkets by developing an infinite period model with overlapping consumers. If the aftermarket is characterized by constant returns to scale, then social surplus and consumer surplus are invariant with respect to aftermarket power. Under increasing returns to scale,...