Entry auctions and strategic behavior under cross-market price constraints
Publication
, Journal Article
Anton, JJ; Vander Weide, JH; Vettas, N
Published in: International Journal of Industrial Organization
January 1, 2002
We examine how universal service provisions and price restrictions across markets impact strategic entry and pricing. We develop a simple multi-market model with an oligopolistic (profitable) urban market and entry auctions for (unprofitable) rural service. Cross-market price restrictions induce a firm operating in both markets to become a 'softer' competitor, thus placing the firm at a strategic disadvantage. When we account for entry incentives and strategic bidding, the downstream strategic disadvantage becomes advantageous, leading to higher prices and profits. Price restrictions may also put outside firms, even relatively inefficient ones, at a strategic advantage. © 2002 Elsevier Science B.V. All rights reserved.
Duke Scholars
Published In
International Journal of Industrial Organization
DOI
ISSN
0167-7187
Publication Date
January 1, 2002
Volume
20
Issue
5
Start / End Page
611 / 629
Related Subject Headings
- Economics
- 3803 Economic theory
- 3801 Applied economics
- 3507 Strategy, management and organisational behaviour
- 1403 Econometrics
- 1402 Applied Economics
- 1401 Economic Theory
Citation
APA
Chicago
ICMJE
MLA
NLM
Anton, J. J., Vander Weide, J. H., & Vettas, N. (2002). Entry auctions and strategic behavior under cross-market price constraints. International Journal of Industrial Organization, 20(5), 611–629. https://doi.org/10.1016/S0167-7187(01)00055-8
Anton, J. J., J. H. Vander Weide, and N. Vettas. “Entry auctions and strategic behavior under cross-market price constraints.” International Journal of Industrial Organization 20, no. 5 (January 1, 2002): 611–29. https://doi.org/10.1016/S0167-7187(01)00055-8.
Anton JJ, Vander Weide JH, Vettas N. Entry auctions and strategic behavior under cross-market price constraints. International Journal of Industrial Organization. 2002 Jan 1;20(5):611–29.
Anton, J. J., et al. “Entry auctions and strategic behavior under cross-market price constraints.” International Journal of Industrial Organization, vol. 20, no. 5, Jan. 2002, pp. 611–29. Scopus, doi:10.1016/S0167-7187(01)00055-8.
Anton JJ, Vander Weide JH, Vettas N. Entry auctions and strategic behavior under cross-market price constraints. International Journal of Industrial Organization. 2002 Jan 1;20(5):611–629.
Published In
International Journal of Industrial Organization
DOI
ISSN
0167-7187
Publication Date
January 1, 2002
Volume
20
Issue
5
Start / End Page
611 / 629
Related Subject Headings
- Economics
- 3803 Economic theory
- 3801 Applied economics
- 3507 Strategy, management and organisational behaviour
- 1403 Econometrics
- 1402 Applied Economics
- 1401 Economic Theory