Issue 6

December 1991

Endogenous Quality Differentiation in Congested Markets

Firms selling a product with congestion externalities to a heterogeneous population of customers have an incentive to offer differentiated levels of quality.

Quality Differentials and Prices: Are Cherries Lemons?

In Akerlof's market for lemons, goods of differential qualities sell under the same standard. If no price differentials exist, then the low quality goods drive out the high quality goods.

Untimely Entry

Recent research indicates that when entrants incur set-up costs there is a tendency for oligopolistic industries to support too many firms.

Cointegration Analysis of the Advertising-Sales Relationship

The examination of stochastic properties of the annual advertising and sales data from the Lydia Pinkham Company reveals that the series are cointegrated and, therefore, possess a long-run equilibrium

Generalizing Location Games to a Graph

We study two-firm location games on graphs. Earlier work analyzes two-firm location games on a line or a circle, and all examples given possess pure Nash equilibria.

Profitability and Price Flexibility in Manufacturing for a Developing Country

This paper reports on an econometric structure-performance model for a mixed-market developing economy, the East African state of Malawi.

Hotelling Duopoly with Uninformed Consumers

This paper analyzes price competition in a duopoly à la Hotelling in which perfectly and different types of imperfectly informed consumers coexist.

Vertical Structure and Nash Equilibrium: A Note

A frequently cited proposition in industrial organization is that vertical integration of bilateral monopolists improves economic efficiency in the case of fixed-proportions production.

Spatial Price Discrimination and Mill Pricing: Hypermobile Multiplant Monopoly

For almost two decades a literature has accumulated claiming that a monopolist can have better performance in terms of output, price and welfare if it employs spatial price discrimination rather than