Firms signal high quality through high prices even if the market structure is highly competitive and price competition is severe. In a symmetric Bertrand oligopoly where products may differ only in their quality, production cost is increasing in quality and the quality of each firm’s product...

We analyze two-part tariffs in an oligopoly, where each firm commits to a quantity and a fixed fee prior to the determination of unit prices. In the case of homogeneous consumers, Harrison and Kline (2001) showed that the equilibrium involves marginal cost pricing and that increased competition...

We embed the principal-agent model in a model of spatial differentiation with correlated consumer preferences to investigate the competitive implications of personalized pricing and quality allocation (PPQ), whereby duopoly firms charge different prices and offer different qualities to different...

Two producers offer differentiated goods to a representative consumer. The buyer has distinct marginal valuations for the quality of the products. Each producer perfectly knows the consumer's taste for its own product, but remains uninformed about its taste for the rival's product. When each...

We analyze spying out a rival’s price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

We analyze spying out a rival's price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

We consider a duopolistic market in which a green firm competes with a brown rival and both firms offer two vertically differentiated quality products. We study optimal non-linear contracts offered by the two firms when consumers: (i) are privately informed about their willingness to pay for...

This paper discusses a model where consumers simultaneously differ according to one unobservable (preference for quality) and one observable characteristic (location). In these circumstances nonlinear prices arise in equilibrium. The main question addressed in this work is whether firms should...

We study personalized pricing (or first-degree price discrimination) in a general oligopoly model. In the short-run, when the market structure is fixed, the impact of personalized pricing hinges on the degree of market coverage (i.e., how many consumers buy). If coverage is high (e.g., because...