We consider a nonlinear pricing problem faced by a dominant firm which competes with a capacity-constrained minor firm for a downstream buyer who may purchase the product from the firms under complete information. Specifically, we analyze a three-stage game in which the dominant firm offers a...

We develop models of bilateral oligopoly with two-way traffic exchanges to study the impact of competition and government regulatory policies on the international telephone markets. When carriers in each country are required to act collectively in setting a uniform settlement rate for inbound...