Tag: Bureau of Economics

Displaying 141 - 160 of 329 results.

This paper shows that an upstream monopolist that sells to competing downstream firms can profitably use exclusive contracts to deter entry even where scale economies are absent. By offering downstream firms a discount if they sign an exclusive contract covering later periods, the...
Theory argues that R&D intensity and acquisition activity may be either directly or inversely related. However, empirically we know relatively little about which firms are responsible for acquisition activity in high-technology industries. Using a panel of 217 U.S. electronic and...
It is well known that product differentiation increases both prices and profits, other things equal. What is less well understood is how the distribution of consumer preferences affects firms’ incentives to differentiate their products. This paper focuses on the incentive of firms to...
When punitive damage awards create publicity, this could affect the behavior of uncompensated victims, which has implications for the optimal punitive damage multiplier. A new adjusted multiplier is derived that incorporates publicity into the analytical framework. Assuming that all...
In three recent hospital merger cases, the courts concluded that the merged hospital would be unable to increase price profitably because of competition from distant hospitals.
Recent analyses of entry deterrence strategies have required an incumbent's post-entry output or pricing strategy to be profit maximizing. However, most papers have continued to assume that either an incumbent can commit not to exit after entry or that exit is never optimal. When...
We compare a seller's agency regime, in which agents give sellers information about buyers' willingness to pay, with a buyer's agency regime, in which agents keep buyers' information confidential. Aggregate gains from trade can be higher under either agency regime. Aggregate gains...
I analyze the innovation incentives under monopoly and duopoly provision of horizontally differentiated products purchased via bilateral negotiations, integrating the market structure and innovation literature with the holdup literature. I show that competition can improve local...
We compare the well-known first-price auction with a common but previously unexamined exchange process that we term "multilateral negotiations." In multilateral negotiations, a buyer solicits price offers for a homogeneous product from sellers with heterogeneous costs, and then plays...
This paper estimates price-marginal cost mark-ups for Canadian manufacturing industries during the 1970s in order to assess the impact of import competition on domestic market power. The results are mixed. Based on the analysis, there is no consistent evidence that imports had a...
Electric power is the latest -- and largest -- industry in which advances in technology have made extensive regulation obsolete. In particular, it is now possible for customers (e.g., residential consumers and businesses) to select their own electric power supplier, while the...
This report presents the results of a nationwide survey of rent-to-own customers. The survey found that most rent-to-own merchandise is ultimately purchased by the customer, most customers are satisfied with their rent-to-own transactions, and most customers are treated well if they...
Recent theoretical work on retail pricing dynamics suggests that retailers frequently change prices of specific items, even when their costs are unchanged. We extend this theory to explain which particular retail items will be subject to periodic temporary reductions. We then make...
In some cases, complementary products are sold to different sets of agents to aid in transactions between them. In the context of a simplified model, this paper shows that a monopolist has an incentive to integrate into and foreclose other sellers of a complementary product used in...
This report analyzes the U.S. carbonated soft drink ("CSD") industry, with its primary focus on the 1980s and early 1990s, a period of rapid structural change that transformed the industry. In addition to documenting these changes, an empirical model is developed to evaluate the...
By permitting firms to have different entry costs, I generalize two previously studied models of two-stage entry and pricing amongst Bertrand competitors. I find that the existing results depend critically on the symmetry assumption. For example, if firms' entry decisions are...
Gasoline "divorcement" regulations restrict the integration of gasoline refiners and retailers. Theoretically, vertical integration can harm competition, making it possible that divorcement policies could increase welfare; alternatively, these policies may reduce welfare by...
Applying conventional horizontal merger enforcement rules to mergers of nonprofit hospitals is controversial. Critics contend that the different objective function of not-for-profits entities should mitigate, and possibly eliminate, competitive concerns about mergers involving...
The report reviews significant informational, institutional, and structural changes that have influenced price and non-price competition strategies of brand-name pharmaceutical companies, particularly during the last 15 years. The study considers the possible antitrust implications...
Can price and advertising be used by vertically differentiated duopolists to signal qualities to consumers? We show that pure price separation is impossible if the vertical differentiation is small, while adding dissipative advertising ensures existence of separating equilibria. Two...

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