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Guiso, Luigi; Parigi, Giuseppe - C.E.P.R. Discussion Papers - 1996

Theoretical models of investment under uncertainty predict that the sign and the strength of the investment … investment and the market power of the firm. This paper investigates the effects of uncertainty on the investment decisions of a …. Consistent with the predictions of the theory, there is considerable heterogeneity in the effect of uncertainty on investment: it …

Persistent link: https://www.econbiz.de/10005123802

Investments in Electricity Generating Capacity Under Different Market Structures and with Endogenously Fixed Demand

Boom, Anette - 2003

Investments in Generating Capacities between a monopolist and two competing firms are compared where the firms invest in their capacity and fix the retail price while electricity demand is uncertain. A unit price auction determines the wholesale electricity price when the firms compete. They...

Persistent link: https://www.econbiz.de/10014075437

Price and Investment Dynamics : An Empirical Analysis of Plant Level Data

Lundin, Magnus; Gottfries, Nils; Lindstrom, Tomas - 2004

Price and investment equations are estimated using a unique data set for Swedish manufacturing plants. The empirical … in demand and high predetermined investment is associated with a higher price …

Persistent link: https://www.econbiz.de/10014029039

Cartel formation with endogenous capacity and demand uncertainty

Paha, Johannes - 2013

This article analyzes the strategic decisions of firms whether to establish and adhere to a cartel when they can also shape competition by investing into production capacity while being subject to unexpected demand shocks with persistence. The model shows that a negative demand shock can...

Persistent link: https://www.econbiz.de/10010126878

Cartel formation with endogenous capacity and demand uncertainty : conference paper

Paha, Johannes - 2013

This article provides a framework for the analysis of cartel formation. It models the strategic interaction among firms who invest into production capacity, sell a near-homogeneous good, and are subject to unexpected demand shocks with persistence. The firms either compete or collude in prices....

Persistent link: https://www.econbiz.de/10010343755

Subsidies, Entry and the Distribution of R&D Investment

Asker, John - 2009

We analyze the link between entry and R&D spending distribution. We consider a monopolistic competitive market with free entry in which firms can invest in cost-cutting R&D by paying a fixed cost first. For an intermediate level of fixed cost, there is a unique equilibrium in which the market...

Persistent link: https://www.econbiz.de/10013158070

Does Market Size Matter? A Dynamic Model of Oligopolistic Market Structure, Featuring Costs of Creating and Maintaining a Market Position

Bloch, Harry; Eaton, Buford Curtis; Rothschild, R. - 2014

In their efforts to create a position in a market, and to maintain that position, firms make positioning investments of various sorts, in R&D, plant, advertising, and location, or more generally, in product development and maintenance. The heart of this paper is the hypothesis that the success...

Persistent link: https://www.econbiz.de/10014149981

Subsidies, Entry and the Distribution of R&D Investment

Asker, John - 2009

We analyze the link between entry and Ramp;D spending distribution. We consider a monopolistic competitive market with free entry in which firms can invest in cost-cutting Ramp;D by paying a fixed cost first. For an intermediate level of fixed cost, there is a unique equilibrium in which the...

Persistent link: https://www.econbiz.de/10012720651

Price and investment dynamics : theory and plant level data

Lundin, Magnus; Gottfries, Nils; Bucht, Charlotte; … - 2007 - rev.

capital. The firm is financially constrained and there are implementation lags in investment. Our model predicts that product … related to investment. Estimating price and investment equations on panel data for Swedish manufacturing plants we find … results which are qualitatively in line with these predictions, though the relation between investment and prices is stronger …

Persistent link: https://www.econbiz.de/10010128004

The effect of horizontal mergers, when firms compete in prices and investments

Motta, Massimo; Tarantino, Emanuele - 2017

-competitive. To study the effects of mergers, we rewrite a game with simultaneous price and cost-reducing investment choices as one …

Persistent link: https://www.econbiz.de/10011798644

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