We provide an alternative theory of divestiture that relies on product-line complementarities and product market competition. We show that in equilibrium competing conglomerates with complementary product lines have incentives to divest and that such divestitures increase both the prices of all the products and the profits of the parent firms, but reduce total surplus. We further show that if t...

Strategic interactions between two-sided platforms depend not only on whether their decision variables are strategic complements or substitutes as for one-sided firms, but also -and crucially soon whether or not the platforms subsidize one side of the market in equilibrium. For example, with prices being strategic complements across platforms, we show that a cost-reducing investment by one firm...

The demand for gasoline follows a seasonal cycle in Sweden. The paper investigates the response in prices and profits over the cycle. In contrast to what has been found for the gasoline market in the United States I find no support for seasonal price changes compatible with the recently developed theories for cyclical variations of intensity of competition. Some possible explanations for this d...

founded in 1970 as the Canadian Environmental Law Research Foundation. It is an independent, not-for profit, environmental law and policy research and education organization. Over the last 15 years, CIELAP has been involved extensively in environmental law and policy development related to biotechnology. In 1984, CIELAP organized the first conference in Canada on environmental law and policy is...

This paper studies the relation between discrete-time and continuoustime principal-agent models. We derive the continuous-time model as a limit of discretetime models with ever shorter periods and show that optimal incentive schemes in the discrete-time models approximate the optimal incentive scheme in the continuous model, which is linear in accounts. Under the additional assumption that the ...

The end of the Cold War and the collapse of the USSR and Yugoslavia result in a proliferation of unrecognized and weak states, which continue to exist today. This article considers the relationship between unrecognized states and the major powers, Russia and the United States, by focusing on the foreign military bases or standing armies of the latter. In addition, unrecognized states, their par...

What roles do firms play in technological change? A new technique involves interests uch as profit and growth. It also involves new knowledge. Just as economic development for Joseph Schumpeter is a new combination of existing elements [1961, pp. 65-66], so technological change combines and develops existing knowledge. To learn what roles firms play in generating (or blocking) technical change,...