This paper is about a model of Bertrand competition in a homogeneous-good market with free entry of identical firms and variable returns to scale. If the optimum number of active firms in the market is two or more, and the number of active firms is equal to that optimum number, then Bertrand...

This paper reformulates a model used by Buchanan and Yoon to formalize the economic problems associated to the so-called "tragedy of the commons" and "tragedy of the anticommons". In doing so we identify two different efficiency problems, due to externalities (common property) and market power....

We present a two-firm model of predation under complete information, based on different discount factors, and integrate it with a model of collusion. Competition, collusion and predation are seen as alternative strategies. The basic conclusions are that there is predation when one firm has a...