IDEAS home Printed from https://ideas.repec.org/a/bpj/germec/v2y2001i2p99-111.html
   My bibliography  Save this article

Strategic Cost Reduction and Cost Revelation

Author

Listed:
  • Jin Jim Y.

    (Queen's University of Belfast, Belfast, Northern Ireland, United Kingdom of Great Britain and Northern Ireland)

Abstract

Strategic cost reduction requires cost transparency. When unilateral cost revelation is feasible, strategic cost reduction indeed arises as equilibrium. If it is not feasible, however, credible revelation has to be organized, possibly by a trade association. Then, firms face a prisoners' dilemma: in Cournot duopoly, cost revelation arises as an equilibrium, but hurts firms; in Bertrand duopoly, cost concealing is the equilibrium, while firms would be better off with cost revelation. Since cost revelation is socially desirable (undesirable) in Cournot (Bertrand) competition, it should be encouraged (discouraged).

Suggested Citation

  • Jin Jim Y., 2001. "Strategic Cost Reduction and Cost Revelation," German Economic Review, De Gruyter, vol. 2(2), pages 99-111, May.
    • Handle: RePEc:bpj:germec:v:2:y:2001:i:2:p:99-111
    DOI: 10.1111/1468-0475.00029
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1468-0475.00029
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1111/1468-0475.00029?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Li, Yi, 2017. "Voluntary disclosure and investment in environmental technology," Journal of Economic Behavior & Organization, Elsevier, vol. 133(C), pages 331-341.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:germec:v:2:y:2001:i:2:p:99-111. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.