The Equivalence of Price and Quantity Competition with Delegation  

Oleh:

Pazgal, Amit I. ; Miller, Nolan H.

Jenis: Article from Bulletin/Magazine
Dalam koleksi: The Rand Journal of Economics vol. 32 no. 2 (2001), page 284-301.
Topik: DELEGATION; equivalence; price; quantity competition; delegation

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: RR10.5 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

In a two - stage differentiated - products oligopoly model, profit -maximizing owners first choose incentive schemes in order to influence their managers' behaviour. In the second stage, the managers compete either both in prices, both in quantities, or one in price and the other in quantity. If the owners have sufficient power to manipulated their managers' incentives, the equilibrium outcome is the same regardless of how the firms compete in the second stage. If demand is linear and marginal cost is constant, basing the manager's objective function on a linear combination of the firm's profit and its rival's profit is sufficient for the equivalence result.

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