Häckner (2000) shows that in a differentiated oligopoly with more than two firms , prices may be higher under Bertrand competition than under Cournot competition, implying that the classical result of Singh and Vives (1984) ...

This paper challenges the assumption commonly used in the theoretical literature on customization that consumers always get their ideal varieties when they purchase a customized product. The author adopts Hotelling's ...

A wide variety of auction models exhibit close relationships between the winner's expected profit and the expected difference between the highest and second-highest order statistics of bidders' information, and between ...

This paper uses a three-stage licensing-delegation-quantity game to study the licensing of a cost-reducing innovation by a patent-holding firm to its competitor. It is shown that licensing is less likely to occur under strategic delegation compared...

We study customization in the Hotelling model with two firms. In addition to providing ideal varieties, the perceived uniqueness of a customized product contributes independently to consumer utility. We show that only when ...

This paper shows that the precautionary premium embodies a tradeoff between risk and downside risk. It is the size of a mean-preserving spread for thish the strength of aversion to risk just offsets the strength of aversion to downside risk. Using...

attention in the literature. This paper provides a Hicks-Slutsky decomposition of the effect of Rothschild-Stiglitz increases in risk on the optimal decision. Two measures of aversion to additional risk are introduced. Their behavior is shown to control...

We show under very parsimonious assumptions that FGLS and GLS are asymptotically equivalent when errors follow an invertible MA(1) process. Although the linear regression model with MA errors has been studied for many ...

Standard target zone exchange rate models are based on nonlinear functions of an unobserved economic fundamental, which is assumed to be bounded, similarly to the target zone exchange rates themselves. A violation of this key assumption is a basic...

This paper analyzes the effects of land use constraints on housing prices. We provide a new framework for evaluating policy when mobility across regions is allowed but limited. A key result is that loosening regulatory constraints within individual...

This paper examines labor market and welfare experiences of participants in Workforce Investment Act (WIA) programs who exited in July 2000-June 2001. Administrative data from six states on earnings and welfare receipt are used to trace...

Several papers compare auctioning heterogeneous assets sequentially with sequentially selling the right to choose among assets not yet taken. Typically motivated by auctions of condos for owner occupation, these papers have assumed that each winning...

Jeremy I. Bulow and Paul D. Klemperer (AER, 1996) argue that the usual concerns of auction design miss the big picture, and show that a simple English auction without a reserve price and N + 1 bidders attains expected ...

Consider an estimate of the common value of an auctioned asset that is symmetric in the bidders' types. Such an estimate can be represented solely in terms of the order statistics of those types. This representation forms ...

Recent empirical research has established that the distributions of a wide range of economic variables are kurtotic in that they have higher peak(s) in the neighborhood of the mean and greater elongation in the tails than the normal distribution...

The adverse-selection literature has only considered the case in which competing sellers' costs of supply are independent and privately known by the individual sellers. In contrast, the auction literature has ignored adverse ...

We construct an economy populated with infinitely-lived agents and show that the Friedman rule is suboptimal. We do that by showing that our economy and an overlapping generations model in which the Friedman rule is known ...

Conditional Markov chain models of observed aggregate share-type data have been used by economic researchers for several years, but the classes of models commonly used in practice are often criticized as being purely ad ...

With the Asian financial crises, people identified crony relationships as the ultimate cause of bank instability. We examine the issue of crony capitalism in the context of model economy in which cronies are a class of ...

informationally-demanding way to ensure efficient make-or-buy decisions is to price inputs at marginal cost. The extent to which input prices can depart from marginal cost while still inducing efficient make-or-buy decisions depends on the relative efficiency...