nep-mic New Economics Papers
on Microeconomics
Issue of 2006‒09‒03
seventeen papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior
  1. Monotonicity and Nash Implementation in Matching Markets with Contracts By Haake Claus-Jochen; Klaus Bettina
  2. Persuasive Advertising in Oligopoly: A Linear State Differential Game By R. Cellini; L. Lambertini; A. Mantovani
  3. Complementarity between Product and Process innovation in a Monopoly Setting By A. Mantovani
  4. Price Competition over Boundedly Rational Agents By B. Luppi
  5. "Process and Product Innovation by a Multiproduct Monopolist: A Dynamic Approach" By L. Lambertini; A. Mantovani
  6. Horizontal Mergers with Scale Economies By D. Dragone; L. Lambertini; A. Mantovani
  7. Screening Efficiency of Networks By D. Lanzi
  8. Weak and Strong Time Consistency in Differential Oligopoly Games with Capital Accumulation By R. Cellini; L. Lambertini
  9. Endogenous Attention Costs and Intertemporal Decision-Making By D. Dragone
  10. Competition, Innovation and Racing for Priority at the U.S. Patent and Trademark Office By Linda R. Cohen; Jun Ishii
  11. Firms' Network Formation Through the Transmission of Heterogeneous Knowledge By R. Andergassen; F. Nardini; M. Ricottilli
  12. Quantifying Equilibrium Network Externalities in the ACH Banking Industry By Daniel A. Ackerberg; Gautam Gowrisankaran
  13. The Effects of Mergers with Dynamic Capacity Accumulation By Jiawei Chen
  14. Transfer Pricing and Enforcement Policy in Oligopolistic Markets By O. Amerighi
  15. Dynamic Oligopoly ˆ la Stackelberg with Stochastic Capital Accumulation By L. Lambertini
  16. Copyleft vs Copyright: some competitive effects of Open Source By D. Lanzi
  17. The Anatomy of a Price Cut: Discovering Organizational Sources of the Costs of Price Adjustment By Mark J. Zbaracki; Mark Bergen; Daniel Levy
  1. By: Haake Claus-Jochen; Klaus Bettina (METEOR)
    Abstract: We consider general two-sided matching markets, so-called matching with contracts markets as introduced by Hatfield and Milgrom (2005), and analyze (Maskin) monotonic and Nash implementable solutions. We show that for matching with contracts markets the stable correspondence is monotonic and implementable (Theorems 1 and 3). Furthermore, any solution that is Pareto efficient, individually rational, and monotonic is a supersolution of the stable correspondence (Theore m 2). In other words, the stable correspondence is the minimal solution that is Pareto efficient, individually rational, and implementable.
    Keywords: microeconomics ;
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:dgr:umamet:2006029&r=mic
  2. By: R. Cellini; L. Lambertini; A. Mantovani
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:564&r=mic
  3. By: A. Mantovani
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:533&r=mic
  4. By: B. Luppi
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:565&r=mic
  5. By: L. Lambertini; A. Mantovani
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:551&r=mic
  6. By: D. Dragone; L. Lambertini; A. Mantovani
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:571&r=mic
  7. By: D. Lanzi
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:555&r=mic
  8. By: R. Cellini; L. Lambertini
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:544&r=mic
  9. By: D. Dragone
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:570&r=mic
  10. By: Linda R. Cohen (Department of Economics, University of California-Irvine); Jun Ishii (Department of Economics, University of California-Irvine)
    Abstract: The U.S. Patent and Trademark Office resolves patent priority disputes in patent interference cases. Using a random sample of cases declared between 1988 and 1994, we establish a connection between patent interferences and patent races, and then use the data to consider some key issues in dynamic competition and innovation. We look at the incidence and distribution of patent races by technology, evidence for strategic delay of innovation by incumbent firms, and evidence that patent races moderate incentives to delay. Our results have implications for patent policy in general and for evaluating the U.S. “first to invent” patent priority rule.
    Keywords: Patent race, Patent interference, US Board of Patent Appeals and Interferences, Patent litigation; Innovation; Research and development
    JEL: K41 L20 O31 O34
    Date: 2005–08
    URL: http://d.repec.org/n?u=RePEc:irv:wpaper:050604&r=mic
  11. By: R. Andergassen; F. Nardini; M. Ricottilli
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:543&r=mic
  12. By: Daniel A. Ackerberg; Gautam Gowrisankaran
    Abstract: We seek to determine the causes and magnitudes of network externalities for the automated clearinghouse (ACH) electronic payments system. We construct an equilibrium model of customer and bank adoption of ACH. We structurally estimate the parameters of the model using an indirect inference procedure and panel data. The parameters are identified from exogenous variation in the adoption decisions of banks based outside the network and other factors. We find that most of the impediment to ACH adoption is from large customer fixed costs of adoption. Policies to provide moderate subsidies to customers and larger subsidies to banks for ACH adoption could increase welfare significantly.
    JEL: L0 L13 L86 L88
    Date: 2006–08
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:12488&r=mic
  13. By: Jiawei Chen (Department of Economics, University of California-Irvine)
    Abstract: We investigate the price and welfare effects of mergers through simulations using a dynamic model of capacity accumulation in which firms produce near-homogeneous products and compete in prices. We find that mergers are welfare-reducing and that their long-run effects are worse than their short-run effects: in the long run average price increases further while total surplus and consumer surplus decrease further. A key feature of the model is that firms are ex ante identical but the industry evolves towards an asymmetric size distribution. If we instead fit the simulated data with an asymmetric costs model, which is a standard approach to explaining persistent asymmetries in market shares, we will systematically underestimate the long-run welfare-reducing effects of mergers, giving rise to misguided antitrust policies.
    Keywords: Merger effects; Dynamic oligopoly; Capacity; Cost misspecification; Simulation
    JEL: C73 D24 L11 L41
    Date: 2006–03
    URL: http://d.repec.org/n?u=RePEc:irv:wpaper:060701&r=mic
  14. By: O. Amerighi
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:567&r=mic
  15. By: L. Lambertini
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:547&r=mic
  16. By: D. Lanzi
    Date: 2005
    URL: http://d.repec.org/n?u=RePEc:bol:bodewp:541&r=mic
  17. By: Mark J. Zbaracki; Mark Bergen; Daniel Levy
    Abstract: The fact that organizations find it hard to change in response to shocks in the environment is a crucial feature of the economy. Yet we know little about why it is so difficult for organizations to adjust, and where these limitations come from. In an effort to discover some of these reasons we ground ourselves in the context of price adjustment, and present a qualitative analysis of an intensive ethnographic field study of the pricing practices at a one-billion dollar Midwestern industrial manufacturing firm and its customers. We go into depth on a specific episode, a price cut, which most vividly exemplifies the themes that emerged from our data. In the specific situation, market forces clearly dictate that the firm should cut prices, and everyone in the firm agrees with this assessment, suggesting a fairly straightforward price adjustment decision. Yet when we look deeper, and dissect how the firm implemented the price cut, we uncover a rich tapestry of frictions hidden within the organization. At their core, these frictions relate to how managers, in the context of an organization, attempt to apply the fundamental elements of economic theory. Essentially they face a series of constraints that make sense in the context of an organization trying to make these adjustments, but constraints that are rarely articulated or incorporated into economic understanding of price adjustment. We discover that the largest barriers to price adjustment are related to disputes arising from collisions between "partial models" used by different organizational participants as they confront fundamental economic issues. Often, these issues have not been settled and exist in a tenuous truce within the organization – and adjustment requires the organization to deal with them in order to react to these changes.
    Date: 2006–08
    URL: http://d.repec.org/n?u=RePEc:emo:wp2003:0610&r=mic
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