In a model of horizontal product differentiation, we show that local monopolied may exist under free entry when capital is perfectly mobile. In contrast both with the situation of restricted entry and with the zero-profit approach to free entry outcomens of Salop 91979), the unit profit rate of...

The purpose on this paper is twofold. First, we present an alternative model of agglomeration and trade that displays the main features of the recent economic geography literature while allowing for the derivation of analytical results by means of simple algebra. Second, we show how this...

This paper shows that the adoption of flexible manufacturing techniques by firms leads to a tougher price regime. This need not benefit consumers since the tougher regime deters entry and facilitates segmented market structures.

Price markups over marginal cost are often higher on "aftermarket" parts, service, and supplies for durable goods that they are on the goods themselves. One explanation for this phonomenons is that the aftermarket good is used as a "metering" device to price discriminate among consumer, a model...

A monopolist firm sells a single product to a market where the customers may be enticed to accept a delay in when their orders are shipped. The enticement is a discounted price for the product. The market consists of several segments with different degrees of aversion to delays. The firm offers...

Our results seem to provide substantial evidence that joint operating agreement's (JOA) act as constrained rather than unconstrained monopolists in setting ad rates and circulation levels. The constraint of having to produce two dailies binds tightly enough to yield JOA CPM's that are much...

In this paper we investigate why regulators may wish to open regulated markets to entry by unregulated firms. We adopt Posner's view of regulation as a taxation scheme, whereby regulators set high rates in some markets in order to subsidize other markets.

We examine minimum quality standards (MQS) regulation in vertically differentiated markets with free entry.

This paper investigates the determinants of the structure of the banking industry by fitting a monopolistic competition model to a sample of banks drawn from eight EEC countries over 1989-1993. In the theoretical model, banks decide strategically both entry and the branching size of their...

It is shown that even when vertical integration leads to an upstream monopoly, welfare can improve if the ex ante market share of the merging firm is large. This result is obtained in a Cournot-Nash equilibrium context with asymmetric marginal costs of production.