Luciano Fanti

• University of Pisa

Common wisdom suggests that noncontrolling, interlocking crossholdings is always profitable in a Cournot duopoly model. Therefore, the maximal profit is obtained by a reciprocal share of ownership of about 50%, which allows for the monopoly profit. By contrast, we analyze a network industry and show that crossholdings can be unprofitable under netw...

In a unionized Cournot duopoly, the present paper re-examines the subject of the bargaining scope (only wages; wages and employment levels) between firms and unions. Given the potential market deterrence effect of the efficient bargaining model, the conventional wisdom that this agenda is socially efficient can be reversed.

Purpose – This article compares the environmental and welfare effects of three policies in a polluting managerial duopoly with homogeneous goods: an emissions tax, an abatement subsidy and a policy mix of those two instruments. Design/methodology/approach – The article analyzes an emissions reduction policy selection in a managerial duopoly using a...

Using a non-cooperative two-stage game, this paper studies the effects of the variable costs of achieving compatibility on the strategic choice of producing compatible/incompatible goods in Cournot and Bertrand duopolistic network industries. A broad variety of sub-game perfect Nash equilibria can emerge depending on the interaction between the coo...

Considering a Cournot duopoly with network goods, this paper shows some unconventional effects due to passive unilateral cross-ownership (i.e., one firm holds non-controlling shares in the rival firm): the industry profitability of the network duopoly can be reduced, or social welfare increased, depending on the degree of compatibility between good...

In a third-country market model in which two export countries adopt environmental policies (taxes and subsidies), this article analyses how an abatement (“green”) subsidy can become a potential strategic trade policy tool. When governments set the optimal policy considering their local environmental damages, a rich set of equilibria arises. In cont...

In a Cournot duopoly with indirect tax evasion, this paper counter-intuitively shows that, in the presence of positive competitive wages, a higher indirect taxation may increase expected profits. This result is likely to occur if the market size (or alternatively, if the cost pressure exerted by wages) is adequately large and the detection probabil...

In a polluting Cournot duopoly with homogeneous goods, this work compares the environmental, public finance and welfare impacts of three policies: an emissions tax, an abatement subsidy, and a policy mix. A subsidy, alone or coupled with a tax, always increases abatement; however, taxation disincentivises production, leading to decreased environmen...

This work aims to investigate the effects of co-determination in a game-theoretic setting by considering network externalities in consumption. The received theoretical literature, so far focused only on standard (non-network) industries, showed that co-determination might emerge as the sub-game perfect Nash equilibrium (SPNE) of a non-cooperative C...

In an industry with homogeneous goods, this note compares the standard incumbent’s strategic capacity choice versus the incumbent’s pre-emptive payment (profit) transfer (PPT) strategy (i.e., pre-entry acquisition). It is shown that via the transfer option, the incumbent holds its monopoly position “dissuading” the potential competitor entry for a...

The lieu common states that social welfare is higher under public than private monopoly. This note shows that, in an industry with firm-union bargaining over wages, it is optimal to privatise a share of the public firm because privatisation is a device to claims. It is also shown that both the reserve wage and the (exogenous) productivity are relev...

Making use of an appropriate game-theoretic approach, this article develops a two-stage game in a Cournot duopolistic network industries, in which firms strategically choose whether to produce compatible goods. Quality differentiation significantly affects the sub-game perfect Nash equilibrium (SPNE): (i) the network effect acts differently between...

This research introduces sales delegation in a product innovation game by considering Cournot and Bertrand duopolies. The article first revisits the existing results with profit‐maximising firms, showing that a prisoner's dilemma with undifferentiated products cannot occur in a Bertrand rivalry setting. Then, by considering the separation between o...

This research revisits the pioneering work by Katz and Shapiro (Am Econom Rev 75:424–440, 1985) with network (consumption) externalities in a twofold way: first, it considers Corporate Socially Responsible (CSR), instead of profit-maximising, firms; second, it uses a game-theoretic approach and analyses the commitment decision game in which firms f...

The R&D literature framed in a strategic context shows two unpleasant outcomes for the public goods nature of knowledge: 1) the private R&D activity results in underinvestment (with no information leakage – no spillovers) or over-investment (with information leakage – positive spillovers) compared to the social optimum because of appropriability, a...

This note represents a corrigendum to Buccella et al. (Citation2022), Network externalities, product compatibility and process innovation, Economics of Innovation and New Technology, DOI: 10.1080/10438599.2022.2095513. It provides a correction to a typo in the utility function of the published version of the article. Results of the published versio...

This article considers a product’s compatibility as a strategic variable in a Cournot duopoly with network consumption externalities. It develops a non-cooperative compatibility decision game (CDG) in which firms choose whether to let products be (in)compatible. With costless compatibility, the unique (Pareto-efficient) sub-game perfect Nash equili...

This article presents a three-stage non-cooperative disclosure decision game (DDG), in which R&Dinvesting firms choose whether to disclose R&D-related information to the rival in a Cournot-like environment. Though firms have no (private) incentive to disclose information unilaterally on their cost-reducing R&D activity to prevent a rival from engag...

In a duopoly model with linear costs, Fanti and Buccella (2018, International Review of Economics) show that, for sufficiently intense network externalities, the equilibrium in which both firms have social concerns is more profitable than simple profit-seeking. This note shows that, with convex costs, firms competing non-cooperatively on the level...

Recently, in their 2019 paper, Poyago-Theotoky and Yong consider a managerial Cournot duopoly with pollution externalities and emission taxes and propose an explicit environmental incentive in a managerial compensation contract. The authors compare several exogenous equilibria emerging in the symmetric sub-games in which the owner offers either the...

Making use of an appropriate game-theoretic approach, this article develops a two-stage game in a Cournot duopoly in network industries, in which firms strategically choose whether to produce compatible goods. Quality differentiation significantly affects the sub-game perfect Nash equilibrium (SPNE) of the game: (i) the network effect acts differen...

The degree of compatibility is a crucial feature of network goods. This article considers the degree of product compatibility as a strategic variable in a Cournot duopoly with network consumption externalities. For doing this, it develops a non-cooperative “compatibility decision game” (CDG) in which choosing whether letting products being (in)comp...

Abstract: In a third-country model in which export countries adopt environmental policies, this note analyses how abatement ("green") subsidy can become a potential strategic trade policy tool. When governments set the optimal policy tool considering their local environmental damages, a rich set of equilibria arise. In contrast to the standard resu...

This paper investigates whether and how vertical industries have the characteristics to be targeted with the subsidy policy instrument. Under both price and quantity competition, the results of the established literature are reversed when exporters are in vertical relations. In particular, the conventional result that the emerging subsidising equil...

In a vertically differentiated unionised Cournot duopoly, this paper compares the equilibrium characteristics of the two main union-firm negotiation agendas, i.e., right-to-manage vs efficient bargaining. It is shown that vertical product differentiation leads to a partial solution of the conflict of interest regarding the bargaining agenda, leadin...

This work revisits the R&D duopoly à la d’Aspremont and Jacquemin (1988, 1990) (AJ henceforth) considering an economy with firms engaged in corporate social responsibility (CSR). In the traditional AJ setting without spill-over effects, firms invest in R&D as a sub-game perfect Nash equilibrium (SPNE) strategy, but they are cast into a prisoner’s d...

This article extends the cost-reducing R&D model with spillovers by d’Aspremont and Jacquemin (1988. “Cooperative and Noncooperative R&D in Duopoly with Spillovers.” The American Economic Review 78: 1133–7, 1990. “Cooperative and Noncooperative R&D in Duopoly with Spillovers:Erratum. ”The American Economic Review 80: 641–2) to allow quantity-settin...

This article examines how determining an optimal environmental tax in a Cournot duopoly with unionized labour markets and managerial firms departing from the strict profit-maximization. It is shown that firmspecific monopoly unions that set wages (1) reduce both the environmental tax and environmental damage and (2) counterintuitively, increase fir...

In a vertically related duopoly with input price bargaining, this paper re-examines the downstream firms’ profitability under different market competition degrees. It is shown the rather counterintuitive result that downstream firms earn highest profits with semi-collusion, whose level depends on the upstream bargaining structures, the relative par...

This article augments d’Aspremont and Jacquemin’s [1988. “Cooperative and Noncooperative R&D in Duopoly with Spillovers.” American Economic Review 78: 1133–1137; 1990. “Cooperative and Noncooperative R&D in Duopoly with Spillovers: Erratum.” American Economic Review 80: 641–642] cost-reducing R&D duopoly by introducing network externalities and pro...

This work revisits the R&D model à la D’Aspremont –Jacquemin (1988) (AJ) in a context with socially responsible firms. In the traditional model firms invest but, in equilibrium, they are cast into a prisoner’s dilemma. Socially responsible firms also invest in equilibrium. However, provided that firms consider sufficiently high consumer welfare, to...

This paper investigates the effects of a public uniform R&D subsidy policy in a downstream duopoly market in which a non-integrated firm, which faces a lower marginal cost, outsources inputs from its vertically integrated rival. The findings show that, in this market structure, such a policy has relevant effects largely differentiated between downs...

In a duopoly with differentiated products under price competition, this paper analyses the firms’ tax compliance behaviour in the presence of tax evasion to challenge the conventional wisdom that indirect taxes penalise profits. In contrast to the preceding literature, it is shown that indirect taxes can increase firms’ profits. The appearance of t...

By analysing interlocking cross-ownership, this work reconsiders the inefficiency of activist governments that set subsidies for their exporters (Brander and Spencer, J Int Econ 18:83–100). Making use of a third-market Cournot duopoly model, we show that the implementation of strategic trade policy in the form of a tax (subsidy) when goods are diff...

In a network industry, this paper investigates the impact of network effects on total pollution under the presence of a union interested to “local” environmental damages (e.g. polluting production processes damaging workers’ health and the local environment where workers live). Under monopoly, it is shown that, on the one hand, network effects tend...

In a monopoly industry with firm-union wage bargaining, we show that it is optimal to privatise a share of the public firm. The optimal privatisation share increases the higher the union’s bargaining power and/or wage-orientation and, when the latter is large, full privatization becomes socially optimal. Interestingly, the optimal privatisation sha...

This article develops a non-cooperative game with managerial quantity-setting firms in which owners choose whether to delegate output and abatement decisions to managers through a contract based on emissions (conventionally denoted as ‘green’ delegation, GD) instead of sales (sales delegation, SD), and the government levies an emissions tax to ince...

This research introduces endogenous codetermination in a Cournot duopoly. Unlike the received literature (Kraft, 1998), this work assumes that firms bargain with their own union bargaining units under codetermination if and only if they can choose an ad hoc bargaining effort by maximising profits (three‐stage non‐cooperative game). There are remark...

In a duopoly network industry with decentralised union wage setting, this paper studies the impact of the firms’ engagement in consumer-friendly Corporate Social Responsibility (CSR) on profitability and welfare. It is shown that, regardless of whether the wage setting occurs prior to or after the choice of the CSR levels, being a CSR-type firm rat...

This research analyses firms' strategic choice of adopting an abatement technology in an environment with pollution externalities when the government levies an emission tax to incentivise firms to undertake emission-reducing actions. A set of different Nash equilibria – ranging from dirty to green production – arises in both quantity-setting and pr...

This paper revisits the issue (dating back to the Brander and Spencer’s approach, 1985) of the well-known inefficiency of the activist regime where Governments set subsidies for their own exporter firms. It is shown that such policies may be efficient (i.e., national social welfares are higher than under free trade) when firms are unionized under t...

This paper shows that, in a bilateral monopoly with consumer-friendly social concerns, only the downstream firm is always incentivized to adopt corporate social responsibility (CSR) if it has decreasing returns to the input, leading to a Pareto-superior outcome in equilibrium. This occurrence differs from a standard linear bilateral monopoly in whi...

The Publisher would like to correct the introduced formatting errors and presentation of the mathematical expressions found on page 12 of the pdf version.

In the light of the recent adoption of social responsible activities by large exporters, this paper sets up a strategic trade policy model in which two national champions compete à la Cournot in a third country and both governments can tax or subsidise the production of its local champion and reconsiders the well-known result of the Prisoner’s Dile...

TABLE OF CONTENTS Arthaniti: Journal of Economic Theory and Practice Sage Publishing Volume 19(2) – December 2020

TOC CONTENTS Arthaniti: Journal of Economic Theory and Practice Sage Publishing Volume 19(2) – December 2020

This paper investigates the relation between market competition and firms' tax evasion in a duopoly with differentiated products under both Bertrand and Cournot conjectures. The previous literature has shown that competition can lead to higher or lower tax evasion. Our paper can help to conciliate these different results by showing that a negative...

This paper challenges the conventional wisdom of the strategic trade policy – in which governments set subsidies for their own exporter firms – under unionisation by considering the realistic difference in the labour market institutions between producing countries, i.e. asymmetric bargaining agenda (Efficient Bargaining, EB, and Right-to Manage, RT...

This study considers whether an incumbent firm can find it profitable to recognise a union and bargain over wages and employment, rather than to face a competitive labour market without unions. Using a sequential game model, this analysis shows that an incumbent firm may recognise a union to deter entry when network effects are sufficiently low.

The paper analyzes the effects of unionization on the labor market under Right-to-Manage (rtm) and Sequential Efficient Bargaining (seb) institutions, focusing particularly on the entry of a firm and comparing traditional and network industries. The findings show that under rtm, unions always play a pro-competitive role, while under eb they may bec...

The presence of unionised firms, especially in oligopolistic contexts, as well as the increasing importance of international trade are evident stylized facts of the contemporary world economy. In the last decades, international trade restrictions have been largely reduced through economic agreements associated with World Trade Organization and regi...

It is commonly believed that the choice of adopting Corporate Social Responsibility (CSR) behaviours is beyond the scope of profit enhancement. In a unionised oligopoly with centralized wage setting and decreasing returns to scale technology, the present paper shows that the owners’ choice of the CSR engagement level is dictated by the firms’ purel...

Economists believe that a firm’s engagement in Corporate Social Responsibility (CSR) is motivated by objectives beyond increasing profits. Using a duopoly framework with convex technology and an industry-wide union-setting wage at the central level, this work shows that, when owners cooperatively select a level of CSR engagement, profits under CSR...

The endogenous choice of the bargaining agenda between the two alternatives of Right-to-Manage (RTM, i.e., only wages are negotiated) and Efficient Bargaining (EB, i.e., both wages and employment are negotiated) is examined in a vertically integrated unionized bilateral monopoly with firm-specific negotiations. Although the RTM agenda emerges as th...

In a multiple‐stage duopoly game with strategic delegation and unionized labor market, this paper analyzes whether firms' owners decide managerial incentive contracts sequentially or simultaneously. When firms compete in quantities, firms' owners can choose incentive contracts simultaneously or sequentially, depending on the unions' relative bargai...

In a duopoly in which firms universally engage in corporate social responsibility (CSR) activities, this paper shows that, in contrast to the main tenet of the received managerial delegation literature, if the CSR sensitivity is sufficiently high: (a) when both firms delegate output decisions to managers, at the equilibrium profit (resp. consumer w...

In an industry characterised by the presence of network effects, this paper investigates a duopolistic game in which firms may choose whether to bargain over wages and employment with unions or to face a competitive labour market (i.e., without unions). If unions are sufficiently wage‐sensitive, it is shown that the presence of sufficiently large n...

This research develops a tractable two‐stage non‐cooperative game with complete information describing the behaviour of price‐setting firms that must choose to be profit maximisers or bargainers under codetermination in a network industry with horizontal product differentiation. The existing theoretical literature has already shown that codetermina...

In a vertically related duopoly with input price bargaining, this paper reexamines the downstream firms' profitability under different market competition degrees. Downstream firms earn highest profits with semi-collusion whose level depends on product differentiation and relative parties' bargaining power. Holding fixed the upstream suppliers' barg...

Economists believe that a firm's engagement in Corporate Social Responsibility (CSR) is motivated by objectives beyond increasing profits. Using a duopoly framework with convex technology and an industry-wide union-setting wage at the central level, this work shows that, when owners cooperatively select a level of CSR engagement, profits under CSR...

We study whether a quantity or a price contract is chosen at equilibrium by one integrated firm and its retail competitor in a differentiated duopoly. Using a similar vertical structure, Arya et al. (2008) show that Bertrand competition is more profitable than Cournot competition, which contrasts with conventional wisdom. In this article, we first...

This paper investigates the effects of the introduction of a profit-sharing rule and a profit tax/subsidy (T/S) policy on social welfare in a Cournot duopoly in the presence of decentralized firm-union bargaining over wage rates. It is shown that 1) the social welfare is always increasing in the share of profits distributed to workers and profit ta...

In a vertically related duopoly with input price bargaining, this paper re-examines the downstream firms’ profitability under different market competition degrees. Downstream firms earn highest profits with semi-collusion, whose level depends on product differentiation and the relative parties’ bargaining power. Holding fix the upstream suppliers’...

Making use of a Conjectural Variation model, the present note re-examines the subject of the firms’ profits ranking under different degrees of market competition in a unionized duopoly with industry-wide Efficient Bargaining (EB). It is shown that, while Cournot-like competition profits are always larger than Bertrand-like ones with separated wage...

Motivated by the recent increase of public debt experienced by many developed countries, we develop an OLG model to provide the fiscal policies needed for any public debt level to be sustainable in steady state and the consequences that such policies produce on saving and fertility in a small open economy. Our main finding is that a reduction of pu...

This paper revisits the classic issue of the comparison between price and quantity competition in the presence of Corporate Social Responsible (CSR) private firms. The results are in sharp contrast to the conventional wisdom for profit-seeking firms. In fact, profits can be larger under Cournot (resp. Bertrand) also when products are complements (r...

This research aims at studying a general equilibrium closed economy with overlapping generations and inherited tastes (aspirations), as in de la Croix (Econ Lett 53(1):89–96, 1996). It shows that the interaction between the intensity of aspirations and the elasticity of substitution of effective consumption affects the qualitative and quantitative...

p align="center"> ABSTRACT This paper investigates the selection of the bargaining agenda in a unionized industry with decentralized negotiations for different competition modes. The firms choose the agenda (right-to-manage, RTM, versus efficient bargaining, EB), considering alternative timing of the bargaining game in the case of mixed duopoly....

The present paper shows that, when firms compete in a non-cooperative way on the level of corporate social responsibility (CSR) in network industries, the conventional result of the prisoner’s dilemma structure of the game in standard industries—i.e. to have social concerns is the Nash equilibrium, but it is harmful for firms’ profits—vanishes and,...

This paper analyses the effects of managerial delegation on the equilibrium outcomes in a duopoly market in which firms adopt corporate social responsibility (CSR) behaviours (approximately measured, as usual, by their sensitivity to consumer surplus). In particular, the endogenous choice between the most common manager’s bonus schemes—i.e. sales d...

In this paper the authors investigate whether and how, in a network industry, the intensity of network effects affect the total pollution under the presence of a union interested to "local" environmental damages (e.g. polluting production processes damaging workers' health and the local environment where workers live). Under monopoly, it is shown t...

This research revisits the theoretical literature on codetermination in differentiated Cournot duopoly markets. Although codetermination is widely adopted in some north European countries, the theoretical analysis is restricted to a few number of works. The literature is led by Kraft (1998), who shows that codetermination emerges as a market outcom...

When more competition may damage welfare with socially responsible firmsConsidering a Cournot monopoly/duopoly model with linear/quadratic production costs and Cor­porate Social Responsibility CSR activities, this note shows that, in contrast to the common view, entry may reduce social welfare. Moreover, we remark that the higherthe CSR activities...

This paper reexamines the strategic trade policy issue by considering a bargaining process over managerial contracts and different firms' organizational structures; that is, either family ownership or atomistic shareholders whose board of directors delegate output choice to managers keep control over the firm. We show that, in contrast to the tradi...

In an OLG model of a small open economy we analyse the characteristics of saving and fertility under two different public policies: i) constant per capita taxes (and endogenous public debt) and ii) constant per-capita debt (and endogenous stabilizing taxes). Our analysis highlights that a fertility recovery (reduction resp.) requires always a reduc...

This paper analyses the equilibrium outcomes in a duopoly market where firms follow corporate social responsibility (CSR) behaviours under managerial delegation. It is shown that in the subgame perfect Nash equilibrium of the game, both firms emerge as CSR-type, and the firms’ profitability (resp. the welfare of consumers and society) are beneficia...

ABSTRACT In this paper we investigate whether and how the presence of a union interested in “local” environmental damages (e.g. polluting production processes damaging workers’ health and the local environment where workers live) affects the welfare of single agents — firms, consumers and workers — and society as a whole. Under monopoly it is shown...

This note investigates the possibility of profit raising entry in network industries where firms follow Corporate Social Responsibility (CSR) behaviours, showing the interaction between the network and CSR features. In particular, for high levels of the network effect, an incumbent’s profits raising entry effect occurs. The latter result is at odds...

This note investigates the possibility of profit raising entry in network industries where firms follow Corporate Social Responsibility (CSR) behaviours, showing the interaction between the network and CSR features. In particular, for high levels of the network effect, an incumbent’s profits raising entry effect occurs. The latter result is at odds...

This paper investigates the effects of public environmental policies on the market structure in a Cournot context. It is shown that when the Government fixes upper limits to emissions, higher environmental social concerns favour entry of a firm. On the other hand, the abatement technology may act as a barrier or an incentive to entry depending on t...

This paper analyzes a multiple-stage game in which, at the final stage, two (managerial) firms compete over quantities in the product market. Prior to this stage, firm-specific unions set the workers' wages, while the owners of both firms hire managers and provide them with incentive contracts. Owners can freely decide to arrange the managerial con...

This article aims at studying a general equilibrium model with overlapping generations that incorporates inherited tastes (aspirations) and endogenous longevity. The existence of standard-of-living aspirations transmitted between two subsequent generations in a context where the individual state of health depends on public investments in health has...

This paper re-examines the well-known activist regime's inefficiency (governments set export subsidies) in a sales–delegation game with owner–manager bargaining over contracts. Contrary to the received literature, this bargaining process may (a) induce governments to set a tax if products are not too substitute or complements and (b) lead to an eff...

We analyse the endogenous choice of the competition mode (price vs. quantity) in a duopoly model with managerial delegation and unionized labor markets. Depending on the unions' relative bargaining power and the degree of product differentiation, the set of possible outcomes proves to be very rich, including alternatively a unique quantity or price...

In a software industry based on a platform firm and two firms producing differentiated applications complementary to the platform, we investigate the effects on profits and welfare of the choice of different contracts (price versus quantity) by the application firms. In contrast to the traditional result, 1) equilibrium profits are higher under Cou...

In a software industry based on a platform firm and two firms producing differentiated applications complementary to the platform, we investigate the effects on profits and welfare of the choice of different contracts (price versus quantity) by the application firms. In contrast to the traditional result, ( 1 ) equilibrium profits are higher under...

In this paper we revisit the issue of the scope of bargaining between firms and unions by considering a more general union’s utility functionwith distinct preferences and sequential negotiations. First,we compare exogenously given labour market institutions; i.e., right-to-manage (RTM) and sequential efficient bargaining (SEB). We show that the con...

This paper investigates the bargaining agenda selection in a socially concerned unionised monopoly producing a network good. We show that the recently established result that under network effects the firm prefers sequential efficient bargaining may be reversed when there are social concerns. Thus, firm’s social responsibility restores also in netw...

In a public/private unionised monopoly, the common wisdom concerning the bargaining agenda in state-owned enterprises can change dramatically. Although the efficient bargaining (EB) agenda is considered more efficient than right-to-manage (RTM), the public/private monopolist always prefers RTM. Contrary to the assertions of the established literatu...

We investigate the endogenous order of moves in a duopoly under price competition with a unionized labor market. We show that the established results are not robust to the presence of unions. We find that when product substitutability is sufficiently high and unions are sufficiently wage-interested the sub-perfect equilibrium is the simultaneous ch...

This paper examines a duopoly market with Corporate Social Responsibility (CSR) firms (sensitive to consumer surplus). It is shown that, in contrast to the conventional result that the higher the weight on CSR the lower the firms’ profitability, when network externalities in consumption are present even the firms’ profitability may be enhanced by t...

Using a simple Cournot duopoly model with differentiated products, this work studies the firms’ strategic choice of whether to adopt Corporate Social Responsibility (CSR) rules. The proposed game-theoretic approach shows that, depending on the degree of product differentiation and firms’ social concern, different equilibria arise: (1) all firms in...

The present study analyses the effects of two-sided cross-ownership structures in a Cournot duopoly with firm-specific monopolistic unions. Since such mutual cross-participations imply a lower degree of competition, the conventional wisdom is that consumer surplus and social welfare, despite the increase in industry profits, are harmed. By contrast...

This article revisits the managerial delegation literature led by Vickers (1985), Fershtman and Judd (1987) and Sklivas (1987) by introducing a bargaining mechanism between owners and managers over managerial contracts. It shows that the degree of bargaining interacts with the extent of product differentiation in determining whether the sub-game pe...

In this article, we investigate the local and global dynamics of a nonlinear duopoly model with price-setting firms and managerial delegation contracts (relative profits). Our study aims at clarifying the effects of the interaction between the degree of product differentiation and the weight of manager's bonus on long-term outcomes in two different...

This study investigates the effect of consumption externalities on entry decision in network industries. A non-monotonic relation exists in the monopoly/duopoly profit differential. A monopolist which has to pay a cost to maintain his dominant position, such as a license fee or lobby expenditures, can block more easily entry for a wide range of net...

This paper studies how unionization regimes that differ in the degree of wage setting centralization interplay with the strategic choice of production capacity by firms and how this affects product market outcomes. When labour markets are unionized, firms typically opt for under-capacity to dampen the unions’ wage claims. This is in contrast with t...