nep-ind New Economics Papers
on Industrial Organization
Issue of 2010‒08‒14
two papers chosen by
Kwang Soo Cheong
Johns Hopkins University

  1. Bertrand-Edgeworth competition in an almost symmetric oligopoly By De Francesco, Massimo A.; Salvadori, Neri
  2. Regulating Dynamic Markets: Progress in Theory and Practice By Evans, Lewis; Hahn, Robert W.

  1. By: De Francesco, Massimo A.; Salvadori, Neri
    Abstract: We analyze a Bertrand-Edgeworth game in homogeneous product industry, under effcient rationing, constant marginal cost until full capacity utilization, and identical technology across firms. We solve for the equilibrium and establish its uniqueness for capacity configurations in the mixed strategy region of the capacity space such that the capacities of the largest and smallest firm are sufficiently close.
    Keywords: Bertrand-Edgeworth competition; mixed strategy equilibrium; almost symmetric oligopoly; Mixed strategy equilibrium
    JEL: L13 D43 C72
    Date: 2010–08–03
  2. By: Evans, Lewis; Hahn, Robert W.
    Abstract: A key question facing regulators is how to create an economic environment that encourages appropriate investment and innovation. In this paper we analyze the importance of technological change for both competition and regulation, with a particular focus on the regulation of telecommunications and the Internet. We recommend that dynamic efficiency should be used as the appropriate benchmark for judging the effectiveness of different regulatory approaches. Contrary to conventional wisdom, we find that incentive regulation, such as price caps, is not particularly good at promoting dynamic efficiency. Neither is traditional cost-of-service regulation. As an alternative, we suggested that antitrust, judiciously applied, is likely to be better at promoting dynamic efficiency.
    Date: 2010–05

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