We introduce a flexible model of telecommunications network competition with non-uniform calling patterns, which account for the fact that customers tend to make most calls to a small set of contacts. Equilibrium call prices are distorted away from marginal cost, and competitive intensity is...

Manufacturers constantly make decisions that crucially affect product quality, e.g., through procuring high-quality inputs or maintaining high hygienic standards in production. We show fi rst how a high price for its product increases a manufacturer s incentives, so that there is a positive...