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Author: John Sutton Publisher: MIT Press ISBN: 9780262193054 Category : Business & Economics Languages : en Pages : 600
Book Description
Sunk Costs and Market Structure bridges the gap between the new generation of game theoretic models that has dominated the industrial organization literature over the past ten years and the traditional empirical agenda of the subject as embodied in the structure-conduct-performance paradigm developed by Joe S. Bain and his successors.
Author: John Sutton Publisher: MIT Press ISBN: 9780262193054 Category : Business & Economics Languages : en Pages : 600
Book Description
Sunk Costs and Market Structure bridges the gap between the new generation of game theoretic models that has dominated the industrial organization literature over the past ten years and the traditional empirical agenda of the subject as embodied in the structure-conduct-performance paradigm developed by Joe S. Bain and his successors.
Author: Nelson Bruno Valente de Sá Publisher: ISBN: Category : Equilibrium (Economics) Languages : en Pages : 230
Book Description
This dissertation examines the relationship between market structure, welfare and average productivity. In doing so, two distinct questions are integrated into a unified framework. The first question addresses the role of concentration indicators in accessing the welfare properties of industry equilibrium. The second question focuses on the way incentives for upstream specialization decisions are shaped by the downstream market structure.
Author: Howard W. Smith Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
While online consumers are less concerned than traditional consumers about firm location, they may be more concerned about unobservable quality and, to signal this, online retailers rely more on advertising than traditional retailers. Imperfect price competition may arise because of vertical product differentiation, incomplete consumer awareness, and near-perfect information exchange between retailers. This paper evaluates alternative theories of competition and market structure in online retailing. Advertising, product development, and revenue data for the online book market reveal that consumers respond to advertising and website spending rather than low prices. As the market size expanded, during 1997-2001, these endogenous sunk costs escalated and there was no major new entry. Advertising-to-sales ratios and market-concentration ratios are much higher than for traditional bookselling. Using price and demand information for individual books over a number of weeks, we find counter-cyclical and cross-sectional price variation inconsistent with perfect price competition.
Author: Pietro F. Peretto Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
I discuss a model of endogenous innovation that brings to the forefront the in-house R&D activity of the modern corporation. In a symmetric oligopoly, firms undertake cost-reducing R&D subject to a research technology with incomplete spillovers. Concentration of sales and R&D resources determine the optimal scale and the efficiency of firms' R&D operations and, thus, the rate of productivity growth. In addition, R&D expenditures (a sunk cost) are one component of total fixed costs and determine the number of active firms in zero-profit equilibrium. This feed-back makes the price, investment, entry, and exit decisions interdependent. A rich characterization of the balanced growth path, defined as the rate of growth and the number of firms that the market supports in general equilibrium, emerges. Multiple equilibria may exist and firms' expectations about rivalry determine the economy's performance.
Author: John Sutton Publisher: MIT Press ISBN: 9780262692649 Category : Business & Economics Languages : en Pages : 700
Book Description
John Sutton sets out a unified theory that encompasses two major approaches to studying market, while generating a series of novel predictions as to how markets evolve. Traditionally, the field of industrial organization has relied on two unrelated theories—the cross-section theory and the growth-of-firms theory—to explain cross-industry differences in concentration and within-industry skewness. The two approaches are based on very different mathematical structures and few researchers have attempted to relate them to each other. In this book, John Sutton unifies the two approaches through a theory that rests on three simple principles. The first two, a "survivor principle" that says that firms will not pursue loss-making strategies, and an "arbitrage principle" that says that if a profitable opportunity is available, some firm will take it, suffice to define a set of possible outcomes. The third, the "symmetry principle," says that the strategy used by a new entrant into any submarket depends neither on the entrants identity nor on its history in other submarkets. This allows researchers to bring together the roles of strategic interactions and of independence effects. The result is that the considerations motivating the cross-section tradition and those motivating the growth-of-firms tradition both drop out within a single game-theoretic model. This book follows Sutton's Sunk Costs and Market Structure, published by MIT Press in 1991.
Author: John Sutton
Author: John Sutton
Author: Ioannis N. Kessides
Author: Vivek Ghosal
Author: Nelson Bruno Valente de Sá
Author: William J. Baumol
Author: Catherine Matraves
Author: Simon Latcovich
Author: Howard W. Smith
Author: Pietro F. Peretto
Author: John Sutton