Multi-market Oligopoly with Production before Sales
AbstractWhen production takes place before firms allocate output to different markets, the equilibrium may be different from the one corresponding to simultaneous production and allocation decisions. The difference arises when firms account for the output-shifting effect their own production levels have on the allocation decisions of rivals. The authors determine conditions under which the two equilibria are different and indicate the direction of change from the simultaneous equilibrium. Applying the model to reciprocal dumping ($2B la Brander-Krugman 1983), the condition reduces to the concavity or convexity of demand. Copyright 1989 by Blackwell Publishing Ltd.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Journal of Industrial Economics.
Volume (Year): 38 (1989)
Issue (Month): 2 (December)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-1821
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- Wegberg, M.J.A.M. & Witteloostuijn, A. van, 1992. "Credible entry threats into contestable markets: a multimarket model of contestability," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5373412, Tilburg University.
- Tse, Chung Yi, 2001. "Risky quality choice," International Journal of Industrial Organization, Elsevier, vol. 19(1-2), pages 185-212, January.
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