Market power in bilateral oligopoly markets with non-expandable infrastructures

Yukihiko Funaki, Harold Houba*, Evgenia Motchenkova

*この研究の対応する著者

研究成果: Article査読

2 被引用数 (Scopus)

抄録

We develop a novel model of price-fee competition in bilateral oligopoly markets with non-expandable infrastructures and costly transportation. The model captures a variety of real market situations and it is the continuous quantity version of the assignment game with indivisible goods on a fixed network. We define and characterize stable market outcomes. Buyers exclusively trade with the supplier with whom they achieve maximal bilateral joint welfare at prices equal to marginal costs. Maximal fees and the suppliers’ market power are restricted by the buyers’ credible threats to switch suppliers. Maximal fees also arise from a negotiation model that extends price competition to price-fee competition. Competition in both prices and fees necessarily emerges. It improves welfare compared to price competition, but buyers will not be better off. The minimal infrastructure achieving maximal aggregate welfare differs from the minimal network that protects buyers most.

本文言語English
ページ(範囲)525-546
ページ数22
ジャーナルInternational Journal of Game Theory
49
2
DOI
出版ステータスPublished - 2020 6月 1

ASJC Scopus subject areas

  • 統計学および確率
  • 数学(その他)
  • 社会科学(その他)
  • 経済学、計量経済学
  • 統計学、確率および不確実性

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