Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5058391 | Economics Letters | 2016 | 4 Pages |
Abstract
We re-investigate the endogenous choice of price (Bertrand) and quantity (Cournot) contract in the presence of a vertically related upstream market for input. We find that choosing price contract is the dominant strategy for downstream firms when the two-part-tariff pricing contract is determined through centralised Nash bargaining. We further show that the level of social welfare is the same regardless of the mode of product market competition (i.e., Bertrand or Cournot).
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Debasmita Basak, Leonard F.S. Wang,