Using decentralized Nash bargaining with two-part tariff under mutual outsourcing between symmetric downstream firms, we demonstrate endogenous choice of competition mode with each exclusive channel. Recent market structure captures that the mutual outsourcing has become a common business...

In the presence of network externalities, we compare the stability of collusion under Bertrand and Cournot duopoly with differentiated products. Contrast to previous studies, we show that (i) firms have stronger incentive to collude under Bertrand competition than under Cournot competition in...