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on Industrial Organization |
| By: | Mauro Caselli; Arpita Chatterjee; Shengyu Li |
| Abstract: | This paper introduces a method for estimating productivity and quality at the firm-product level using a transformation function framework. We use firm optimization conditions to establish a one-to-one mapping between observed data and unobserved productivity and quality. We do not need to impute firm-product input shares and can avoid imposing productivity evolution processes. The method is scalable to numerous products and can address the bias caused by unobserved heterogeneous intermediate input prices. We apply the method to a set of Mexican manufacturing industries and examine the roles of across-firm and within-firm technological spillovers, accounting for the trade-off between productivity and quality. Our quantitative analysis shows that an exogenous, product-specific technological improvement generates substantial gains in welfare, amplified by both within-firm and across-firm spillovers by approximately 17 percent and 5 percent, respectively. Moreover, within-firm resource reallocation toward the most productive products accounts for 60 percent of the resulting firm-level productivity gains. |
| Keywords: | Productivity; Technology; Industrial organization |
| JEL: | D24 L11 L15 O33 |
| Date: | 2026–01–12 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedgif:102364 |
| By: | Esmat Sangari; Rajni Kant Bansal |
| Abstract: | We study mixed bundling and competitive price-matching guarantees (PMGs) in a duopoly selling complementary products to heterogeneous customers. One retailer offers mixed bundling while the rival sells only a bundle. We characterize unique pure-strategy Nash equilibria across subgames and compare them to a no-bundling benchmark. Mixed bundling strictly dominates whenever an equilibrium exists. Conditional on bundling, PMG adoption trades off strategic demand capture against margin losses on loyal customers and varies systematically with relative demand responsiveness to prices and complementarities. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.15350 |
| By: | Yuichiro KUBO; Tomohito HONDA; Hirofumi UCHIDA |
| Abstract: | This study examines whether, when acting as sellers in M&A transactions, privately held firms set sales conditions and make buyer selection decisions that reflect stewardship considerations. Using unique data on M&A involving privately held small and medium-sized enterprises (SMEs), our analysis reveals that many set sales conditions which reflect their preferences for stewardship-orientation. However, we do not find that family firms are more likely to do so, nor to select buyers with less informational asymmetry, than non-family firms. These findings indicate that in M&A transactions, privately held firms behave as suggested by stewardship theory, but there are no significant differences between family and non-family firms. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:eti:dpaper:26006 |
| By: | Yaonan Jin; Yingkai Li |
| Abstract: | We study revenue maximization when a seller offers $k$ identical units to ex ante heterogeneous, unit-demand buyers. While anonymous pricing can be $\Theta(\log k)$ worse than optimal in general multi-unit environments, we show that this pessimism disappears in large markets, where no single buyer accounts for a non-negligible share of optimal revenue. Under (quasi-)regularity, anonymous pricing achieves a $2+O(1/\sqrt{k})$ approximation to the optimal mechanism; the worst-case ratio is maximized at about $2.47$ when $k=1$ and converges to $2$ as $k$ grows. This indicates that the gains from third-degree price discrimination are mild in large markets. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.16488 |
| By: | Joseph Goodman; Lancelot Henry de Frahan; Justin E. Holz; John A. List; Niall MacMenamin; Evan C. McKay; Magne Mogstad; Sally Sadoff; Hal Sider |
| Abstract: | We leverage Becker’s time allocation theory to examine consumer demand and market competition for time-intensive goods. The Beckerian model predicts higher diversion ratios for goods with substantial time shares and those with high time costs relative to monetary prices. Applying this model to data from two field experiments, we analyze demand for Facebook and Instagram, focusing on substitution patterns across online activities and offline time use. Our findings indicate that users exhibit low elasticity to ad load, the primary user cost, and that time shares and time costs significantly influence diversion ratios. We explore the implications for user costs and benefits on these platforms and assess the potential impact of a Federal Trade Commission-proposed de-merger of Facebook and Instagram. |
| JEL: | C93 D11 D12 L4 L86 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34743 |