How to Compete? Cournot versus Bertrand in a Vertical Structure with an Integrated Input Supplier.
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. () show that Bertrand competition is more profitable than Cournot competition, which contrasts with c...
| Publicado en: | Southern Economic Journal Vol. 85; no. 3; pp. 796 - 821 |
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| Autores principales: | , |
| Formato: | Artículo |
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Wiley-Blackwell
Jan2019
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=133851627&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 133851627 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00384038 SEJ jtl: Southern Economic Journal issn: 00384038 maglogo: N pubinfo: dt: Jan2019 vid: 85 iid: 3 pid: 480 pub: Wiley-Blackwell artinfo: ui: 133851627 10.1002/soej.12324 ppf: 796 ppct: 25 formats: fmt: – @attributes: type: T – @attributes: type: C – @attributes: type: P size: 344KB tig: atl: How to Compete? Cournot versus Bertrand in a Vertical Structure with an Integrated Input Supplier. aug: au: Fanti, Luciano Scrimitore, Marcella affil: Dipartimento di Economia e Management, Università di Pisa, via Ridolfi 10, 56100, Pisa Italy Dipartimento di Scienze dell'Economia, Università del Salento, Ecotekne, via per Monteroni, 73100, Lecce Italy su: Economic competition Contracts Duopolies Industrial concentration Executives sug: subj: Economic competition Contracts Duopolies Industrial concentration Executives keyword: D43 L13 L21 D43 L13 L21 ab: 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. () show that Bertrand competition is more profitable than Cournot competition, which contrasts with conventional wisdom. In this article, we first demonstrate that such a result is robust to the endogenous determination of the type of contract. Second, by introducing managerial incentives in the model, we find that delegation to managers may lead each firm to choose a quantity contract and, as long as products are sufficiently differentiated, entails conflicting choices causing nonexistence of equilibrium in pure strategies. Significantly high product substitutability reconciles firms' objectives under delegation, leading unique or multiple equilibria with symmetric types of contracts to arise. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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