The paper shows that taking inventory control out of the hands of competitive or exclusive retailers and assigning it to a manufacturer increases the value of a supply chain especially for goods whose demand is highly volatile. This is because doing so solves incentive distortions that arise...

We provide a simple model to investigate decisions on vertical integration/separation. The key feature of this model is that more than one input is required for the final products of the local downstream monopolists. Depending on their cost structure, downstream firms' decisions on vertical...

The emergence of smart TV device encourages the reconsideration of the customer’s subscription on the pay TV so that the phenomenon of cord-cutting evokes the other dimension of MVPD (Multi-Channel Video Programming Distribution) industry itself. Two major paths to adopt the new platform in...

We analyze the welfare effects of price discrimination by a monopolistic platform that mediates between two sides of a market. Discrimination is based on asymmetric costs on one side of the market and may be allowed on either or both sides. We show that unconstrained discrimination on both sides...

We explore the incentives of a vertically integrated incumbent firm to license the production technology of its core input to an external firm, transforming the licensee into its input supplier. We find that the incumbent opts for licensing even when licensing also transforms the licensee into...

One of the most relevant and exciting issues in the latest decades in economics had been the asymmetric information and uncertainty, and their effects on market processes and efficiency. Some studies show that markets where information problems or/and uncertainty arise tend to be "networked",...

We characterize mixed-strategy equilibria when capacity constrained suppliers can charge location-based prices to different customers. We establish an equilibrium with prices that weakly increase in the costs of supplying a customer. Despite prices above costs and excess capacities, each...

This paper generalizes the price discrimination framework of Mussa and Rosen (1978) by considering salience-driven consumer preferences in the sense of Bordalo et al. (2013b). Consumers with salience-driven preferences give a higher weight to attributes that vary more. This reduces the...

The unprecedented access of firms to consumer level data not only facilitates more precisely targeted individual pricing but also alters firms' strategic incentives. We show that exclusive access to a list of consumers can provide incentives for a firm to endogenously assume the price leader's...

Purpose. In 2012, Russia became the world's second-largest exporter increasing its potash exports from 1996 to 2012 more than two times. The top five countries control more than 50 % of the world's exports, particularly 53.4 % (38.0 mln MT) for nitrogen, 73.4 % (3.5 mln MT) for phosphate and...