1,721,034 research outputs found
The Economics of Franchising (R.D. Blair, F. La Fontaine, Cambridge University Press, New York, 2005),
No full textThe article reviews the book "The Economics of Franchising", by R.D. Blair and F. La Fontaine
Quantity Competition vs. Price Competition Under Optimal Subsidy in a Mixed Oligopoly
No full textThis paper reconsiders the literature on the irrelevance of privatization in mixed markets within which both quantity and price competition are investigated under product differentiation. By allowing for partially privatization of a state-controlled firm, we explore competition under different timings of firms’ moves and derive the conditions under which an optimal subsidy allows to achieve maximum efficiency. We show that, irrespective of the mode of competition, while the ownership of the controlled firm is irrelevant when firms play simultaneously, it matters when firms compete sequentially, requiring the leader to be publicly-owned for an optimal subsidy to restore the first-best. The paper also focuses on the extent to which a subsidy is needed to attain the social optimum in the considered scenarios, providing an ordering which highlights the subsidy equivalence between Cournot (Bertrand) private leadership and simultaneous Bertrand (Cournot) under duopoly and the dominance of the former in oligopoly
Price or quantity? The strategic choice of subsidized firms in a mixed duopoly
No full textThis paper investigates the endogenous choice of the strategic variable, price or quantity, taken in a mixed duopoly by a public and a private firm prior to market competition. While Matsumura and Ogawa (2012) in a standard mixed duopoly find that price is the unique equilibrium, we show that, by introducing firm subsidization in the same setting, quantity can constitute a dominant strategy equilibrium
The Economics of E-Commerce. A Strategic Guide to Understanding and Designing the Online Marketplace. (Nir Vulkan, Princeton University Press, Princeton and Oxford, 2003)
No full textThe article reviews the book "The Economics of E-Commerce. A Strategic Guide to Understanding and Designing the Online Marketplace," by Vulkan Nir
Profitability in Cournot and Bertrand Mixed Markets under Endogenous Objectives
Full text linkWe examine both quantity and price competition between a number of profit-maximizing firms and a state-controlled enterprise (SCE). The objective function of the latter is strategically defined by a welfare-maximizing government which weighs the SCE’s profits relative to consumer surplus and private profits. Different motives drive the government‘s optimal behavior in the two competitive settings and lead all firms in oligopoly to gain higher profits in Cournot than in Bertrand. The profit ordering is reverted, and social welfare is enhanced, with respect to the purely-mixed market examined by Ghosh and Mitra (2010). In duopoly, aggregate profits are equivalent in Cournot and Bertrand
Spatial Discrimination, Product Substitutability and Welfare
No full textThe paper examines a quantity-location duopoly game in a spatial discrimination model in which the delivered goods are assumed to be imperfect substitutes or complements. By extending the range of the unit transportation cost analyzed in the existing literature, it is shown that a dispersed equilibrium arises in which the choice of the optimal locations is affected by the degree of product substitutability. The interaction between the latter and the size of the transportation cost is also discussed in order to verify its welfare implications. In particular, it is shown that in this spatial framework imperfect substitutability may increase welfare.
Codice Scopus: 2-s2.0-7995885947
Profitability under Commitment in Cournot and Bertrand Mixed Markets
No full textWe examine both quantity and price competition in a mixed oligopoly. In a market in which the adoption of commitment strategies enables the public firm or a government to achieve welfare gains, profits of both the public and the private firms turn out to be higher under Cournot than Bertrand competition. We therefore find that the profit ordering is reversed with respect to the scenario described by Ghosh and Mitra (2010), thus confirming both the higher competitiveness and the higher efficiency of price competition than quantity competition. Moreover, we demonstrate that welfare-maximizing behavior under commitment leads in a duopoly to the same aggregate profits under Cournot and Bertrand
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