It is an empirically established fact that managers use cost based percentage margins when they price their goods. As a consequence, percentage mark-ups should be determined as equilibrium choices. This paper incorporates this empirical observation into the analysis of competition among bilateral monopolists.
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Length: 9 pages Date of creation: Oct 1996 Date of revision: Publication status: Published in Economic Letters, vol.54, 1977, pp. 179-184 Handle: RePEc:lau:crdeep:9622
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