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Does Competition Solve the Hold-Up Problem?

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Author Info

  • Felli, L.
  • Roberts, K.

Abstract

In an environment in which both buyers and sellers can undertake match specific investments, the presence of market competition for matches may solve hold-up and coordination problems generated by the absence of complete contingent contracts. In particular, this paper shows that when marching is assortative and sellers' investment precede market competition the investments are constrained efficient.

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Bibliographic Info

Paper provided by Economics Group, Nuffield College, University of Oxford in its series Economics Papers with number 2000-w11.

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Length: 54 pages
Date of creation: 2000
Date of revision:
Handle: RePEc:nuf:econwp:2000-w11

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Web page: http://www.nuff.ox.ac.uk/economics/

Related research

Keywords: COMPETITION ; MARKET STRUCTURE;

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References

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  3. repec:att:wimass:9608 is not listed on IDEAS
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