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Questions tagged [industrial-organisation]

Industrial organization is a field that builds on the theory of the firm by examining the structure of (and, therefore, the boundaries between) firms and markets. Industrial organization adds real-world complications to the perfectly competitive model, complications such as transaction costs, ...

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Literature on the effects of third-party certification on industrial dynamics?

Is there any comprehensive theoretical studies on how third-party certification adoption may affect industrial performance/dynamics of an industry?
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33 views

Solving a Cournot Equilibrium, the case of Q=q1+q2, Q(q1,q2)=q1+q2

I am struggling with the differentiating between when to use $ Q=q_1+q_2$ and $Q(q_1,q_2)=q_1+q_2$ For a 2 player cournot game, given $$ P=a-bQ, with \ MC's \ c_1 \neq c_2 $$ I find the ...
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1answer
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Articles about the economics of non-compete contracts

Today I read in a non-scientific article that Amazon requires some physical workers to sign non-compete agreements. I used to think that the idea behind allowing non-compete clauses in contracts is to ...
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1answer
20 views

Where can I look up a companies Herfindahl index?

Where can I find Herfindahl indexes on companies (current or past)? Are there any published lists put out by a research institution?
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1answer
30 views

Intuition behind a cournot duopoly nash equilibrium producing a higher output than a monopoly?

I am just wondering if someone could explain the descriptive, not mathematical intuition behind why a cournot equilibrium for a duopoly produces a higher level of output than a monopolist but lower ...
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Book summarizing microeconomic behavior of specific industries?

One of my upper level econ classes was called Government and Business We basically looked at how public policy affected firm, and industry performance - as well as the market process as a whole. ...
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35 views

Firm Dynamic Optimization Problem

A firm has received an order at time $0$ for $M$ units of product to be delivered by time $T$. It seeks a production schedule for filling this order at minimum cost. Let $x(t)$ denote inventory ...
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35 views

Competition and welfare - empirical evidence

Consider the following claims: less competitive markets deliver worse outcomes for consumers, less competitive markets deliver lower social welfare, less competitive markets deliver higher prices/...
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27 views

Competitive Supply Function

How can I in general go about deriving a competitive supply function for a firm in terms of MC, Fixed costs, and shutdown price? I am also not sure why MC and Fixed costs matter in a perfectly ...
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9 views

Can I use my (preliminary) findings to motivate a study

I have to motivate a study of subcontracting in India. Most papers find that subcontracting intensity is increasing in most countries, whereas I find (through preliminary investigation) that ...
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1answer
54 views

Help with Monopolistic Competition Proof, Prove Love for Variety

I need some help with a proof. Assume η = 2 and there are just two goods. Verify that the following utility function exhibits Love for Variety tastes, show that: u(λa + [1 − λ]b, λb + [1 − λ]...
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14 views

What is the difference between different and differentiated products?

Beath & Katsoulacos (1991): „Our starting point is the view that what differentiates products are the characteristics that they each possess and so product differentiation involves making ...
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1answer
68 views

Math in Melitz and Ottaviano (2008)

I am reading Melitz and Ottaviano (2008), but I find it hard to understand some math in the model. The preference is given by : , which implies a demand function: Then the paper says the "inverse ...
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1answer
30 views

Capital mobility across industries and equalization of profit rates

What are some restrictions to the competitive restoration of proportionality across industries in regards to capital mobility? What is generally impeding the free flow of capital from less profitable ...
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1answer
19 views

Developmental studies and industrial policy for the highly developed countries - research trends?

Developmental studies usually is field of reasearch whose object is developing countries and industrial policy studies similarly are attributed to the developing countries or the things of the past. ...
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1answer
212 views

Collusion, deviation from equilibrium

Two firms can produce either low (L), medium (M) or high (H) quantity. The payoff matrix is given by: What is the outcome of this game if firms play only once? Suppose the game is played for infinite ...
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1answer
75 views

Clarification about demand elasticity and monopoly

I am having a difficulty understanding certain things about elasticity and would like to clarify them. What I understand. Elasticity is the percent change in quantity due to a percent change in price,...
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1answer
148 views

Understanding the elasticity of demand for a monopoly

Question: Your are working for a firm that is a monopoly. It is producing using technology that exhibits obvious decreasing returns to scale. After working with them for a while, a co-worker makes a ...
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0answers
55 views

Nested Logit with Market Level Data. Outside option NOT in its own nest. Is this the correct estimating equation?

I am estimating nested logit demand for schools. I am using one level of nests. My nests are private-noncatholic, private-catholic, public-charter, public-noncharter. I define the outside good to be ...
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1answer
37 views

:History: Industry threatening to leave if social change takes effect

With growing inequalities and salary gap, left-wing politicians are asking for social reforms in some countries (I am thinking of France). Social reform include: equal pay for women, maternity leave,...
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61 views

Price discrimination

If I have 3 consumers who I want to sell package 1, 2 and 3 to respectively. Meaning consumer 1 I would like to sell package 1 to, consumer 2 I would like to sell package 2 to and so on. The packages ...
2
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1answer
70 views

Cournot model with piecewise inverse demand

Do you know if there exist results for Cournot oligopoly (or duopoly) when the inverse demand is a piecewise continuous? Something of this type $P(Q) = \alpha-\beta Q$ (if $0\leq Q<Q'$) $P(Q) = ...
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2answers
81 views

Price setting firms with cost reduction technology

As part of my undergraduate studies in Industrial Economics, I am trying to solve the following question: Two price-setting firms are competing in a market for a homogeneous product. There are 10,...
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0answers
355 views

Cobb-Douglas production function with continuum of goods

I'm trying to derive the solution to a final producer with unit elasticity of substitution and a continuum of inputs (of measure $x$). She minimizes input costs, given an output of $q$. $$ \min_{\{y(...
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26 views

Is there a standard way of classifying industries into primary, secondary, and tertiary?

For example, does any government (or academic) have a mapping from industry to sector. For example, mining is primary industry, and retail is tertiary, and so on...
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1answer
44 views

Limit of this sequence // broadness of inputs

Let there be a unit measure of inputs. Define by $C_i = \left[\int_0^i c(i)^{1-\alpha}\right]^\frac{1}{1-\alpha}$ a cost index of using up to $i$ as input. I discretize $c(i)$ by $c_0, \dots c_i, \...
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1answer
47 views

Maximum level of profit attainable when discount factor is too low

This is a question I encountered during my undergraduate studies in Industrial Economics. So the question goes like this: Consider two identical firms with constant marginal cost $c$ which ...
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1answer
26 views

Directed search with privately informed buyers and capacities

My question seems to be a basic one and there should be a rather well-known reference in the (IO or labor) search literature. I will upvote (and comment on) any relevant answer and I will accept an ...
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1answer
35 views

Quality Provision Game

A seller owns a single unit of an invisible good. It is worth $v(s)$ to a buyer, where $s ∈ R^+$ is the quality of the good. The function $v(·)$ is strictly increasing and strictly concave with $v(0) =...
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1answer
92 views

Short-run price competition with capacity contraints

I am doing an undergrad course in Industrial Organization and at the end of the chapter on Short-run price competition (Bertrand and Cournot models mainly), there is a question with which I'm ...
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3answers
877 views

Long Run Equilibrium of Oligopolies

The long run equilibrium of a perfectly competitive market is well established. My question is - are the concepts of a long run equilibrium in a perfect competition extendable (analogous or otherwise) ...
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0answers
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Microeconomics and management science of professional open source companies?

Are there research (and stories more broadly) about professional open source companies? To what types of products their are appropriate, what licensing schemes to choose? How to managed patents and IP?...
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0answers
71 views

How to solve model with a final good (in a perfect competition), and intermediate goods (monopolistic competition)?

Let's imagine there's only one final good produced by one firm, in a perfect competition market. In the intermediate market, we have $N$ goods which are produced and used as factor inputs for the ...
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1answer
91 views

Block pricing for different products

How is a block price decided when there are many products to be sold? For example the buffet in various restaurants or combos in McDonalds or KFC (like the bucket buddy). Can somebody point me to ...
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0answers
86 views

How to compute Social Welfare in this model?

The first part of this scientific article analyzes reward-based crowdfunding. The assumptions are: Seller is a monopolist Unit mass of consumers Unit demand Two periods Individuals are identified by $...
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1answer
29 views

What is a good way te represent analytically two markets with different price elasticities of demand?

It seems that two linear demand curves with different slopes would be a good way to do it, but linear demand curves are hard to work with otherwise.
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1answer
62 views

Price when both supply and demand have market power

I have an intermediate sector that operates using labor only. There is 1-1 pairs between firms and workers, with profits $$\pi = (Ap - w)\cdot 1$$ $p$ is the price, $A$ productivity, $w$ wage. ...
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63 views

Menu-pricing with three consumer groups

I want to analyze the following setting: An entrepreneur (with monopoly power) sells a product in two periods. In period 1 there are two consumer groups (denoted by 1 and 2) and in period 2 there is ...
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39 views

Estimating Demand for Goods with n Choices

I have a data set containing n observations (rows) of mobile applications. The dependent variable is the number of installations -- the variable is categorical (with more than 2 categories). Therefore ...
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1answer
416 views

University course references for Market Structure/Industrial Organization

Are there any books that are used in University-level courses that contain a detailed analysis of market structure ( Perfect competition , Monopoly and so on)?
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2answers
34 views

Is it possible to tell anything about market structure if I have annual price data of the industries?

I have three goods: beer carp (fish) museum ticket Is it possible to tell anything about market structure if I have annual price data of the industries? Here's the time-series plot on a single graph:...
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1answer
138 views

Labour markets and supply-side policies: too much stress put on the WS push factors?

In reading several macro textbooks, it seems that most of the supply-side policies tend to be focused on the labour supply side (wage setting curve), instead on the firm/labour demand side(price ...
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0answers
132 views

STATA: Estimation of Own-Price and Cross-Price Elasticities for Logit, Nested Logit, and BLP Models

I am working with some data on automobile sales and characteristics in a small country. It is an unbalanced panel dataset taken over 6 years and over 5 market segments. I am trying to construct some ...
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1answer
52 views

How to calculate the quantity of an incumbent that sets the profit of a challenger equal to 0?

I have the inverted market demand of $P=4Z-(q_1+q_2)$ and cost function of both firms is equal to $C=cq_i+f$ for $i=1,2$ So now, the existing firm wants to discourage a possible challenger to entry ...
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1answer
64 views

Cournot game with 2 firms

I have given 2 firms in a market with constant marginal costs and no fixed costs market demand has $D(p)$ The firms play a Cournot game I'm supposed to Calculate the equilibrium quantity for each ...
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1answer
85 views

Determine price and cost of intermediate good

Consider a world where an intermediate good is produced using a linear production function in a competitive market: $$ Y = qAL$$ where $q$ is the price of the intermediate good, $A$ is productivity. ...
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1answer
91 views

Market structure and price setting: Imperfect competition in the final good sector

I'm looking at an economy with two sectors. The intermediate good is produced under perfect competition and Cobb-Douglas production. There is a fixed-cost for producers to enter the final market. ...
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0answers
21 views

Is there a simple way to write a model with firms/sectors with different demand elasticities?

I would like to write down a model where there are firms with different demand elasticities: For some firm's total profits increase and decrease a lot with increases and decreases in demand for their ...
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1answer
168 views

Textbook for industrial organization without calculus

I'm planning to teach an undergraduate course in industrial organization. Calculus is not a prerequisite. I also want to avoid doing too much game theory in it so as to not be duplicative of a similar ...
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1k views

In which market structures does the producer employ price discrimination?

I was recently reading up on the Price Discrimination, first second and third degree. Although the author has laid out the concept neatly, there are no connections established between this concept and ...