SFB 504 discussion paper 98-34

Roman Inderst
Sonderforschungsbereich 504
L 13, 15, D-68131 Mannheim
inderst@sfb504.uni-mannheim.de

Competition Drives Up Prices


Abstract:
We present a model where an incumbent firm raises its price in response to increasing competition. It may pay the incumbent to exploit a rather immobile fraction of consumers instead of capturing a larger but more contested segment of the market. In particular, we apply our results to deregulation.
Keywords:
JEL-Classification:
Project:
C5 Moldovanu
Creation date:
1998-10-28
Publication Status
Journal of Economic Behavior & Organization; Vol.47 S. 451-462
Downloadable version
Download titlepage for internal use only
pdf-file


Direct questions and comments to our webmaster.