Price Versus Quantity in a Duopoly with a Unilateral Effect and with Bargaining over Managerial Contracts

详细信息    查看全文

• 作者：Yasuhiko Nakamura
• 关键词：Cournot ; Bertrand ; Managerial delegation ; Delegation contract bargaining ; Asymmetric demand functions
• 刊名：Journal of Industry, Competition and Trade
• 出版年：2017
• 出版时间：March 2017
• 年：2017
• 卷：17
• 期：1
• 页码：83-119
• 全文大小：
• 刊物类别：Business and Economics
• 刊物主题：Industrial Organization; Economic Policy; R & D/Technology Policy; European Integration; Microeconomics; International Economics;
• 出版者：Springer US
• ISSN：1573-7012
• 卷排序：17

文摘

This study examines the endogenous choice of each firm’s strategic contract, that is, a price contract or a quantity contract, in a duopoly in which their demand functions are asymmetric when the content of their managerial contracts is determined through bargaining between the owner and the manager. The degree of asymmetry between their demand functions corresponds to the relation between the goods they produce. In contrast to the case wherein each firm’s delegation parameter is determined through profit maximization, we show that the quantity competition cannot become the equilibrium market structure when the bargaining power of the manager relative to that of the owner is sufficiently low. In particular, when the relation between the two goods is complementary, two asymmetric market structures can be observed in equilibrium. Furthermore, we consider the situation in which the relative bargaining power of the manager to that of the owner within each firm is different between the two firms.