Collusion and heterogeneity of firms.

We examine the impact of heterogeneous discounting on collusion in dynamic Bertrand competition. We show exactly when collusion can be sustained and how collusion would be organized efficiently with heterogeneous discounting. First, we show that collusion is possible if and only if the average disco...

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Publicado en:RAND Journal of Economics (Wiley-Blackwell) Vol. 48; no. 1; pp. 230 - 250
Autores principales: Obara, Ichiro, Zincenko, Federico
Formato: Artículo
Publicado: Wiley-Blackwell Spring2017
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        atl: Collusion and heterogeneity of firms.
      aug:
        au:
          Obara, Ichiro
          Zincenko, Federico
        affil:
          University of California, Los Angeles
          University of Pittsburgh
      su:
        Game theory
        Price fixing
        Discount prices
        Mathematical models of economic competition
        Market share
        Profitability
      sug:
        subj:
          Game theory
          Price fixing
          Discount prices
          Mathematical models of economic competition
          Market share
          Profitability
      ab: We examine the impact of heterogeneous discounting on collusion in dynamic Bertrand competition. We show exactly when collusion can be sustained and how collusion would be organized efficiently with heterogeneous discounting. First, we show that collusion is possible if and only if the average discount factor exceeds a certain threshold, with or without capacity constraints. Next, we identify a dynamic pattern of market share that characterizes efficient collusion and obtain the unique long-run prediction despite the presence of multiple equilibria. In the long run, the most patient firm and the most impatient firm tend to dominate the market.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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