We develop an analytical framework to investigate the competitive implications of personalized pricing and quality allocation (PPQ), whereby rms charge di erent prices and o er di erent qualities to di erent consumers, based on their willingness to pay. We embed PPQ in a model of spatial di erentiation, and show how information about consumer preferences a ects multi-product rms' choices over p...

W model a dynamic purchase context in which a consumer is uncertain about the product’s valuation. The consumer has two purchase opportunities for the product: forward purchase in Period 1 or spot purchase in Period 2. Two forms of regret are considered: buyer’s regret over the money paid in excess of his valuation of the product when buying forward and hesitater’s regret for the lost opportuni...

While some researchers report significant benefits resulting from investments in technology, others report no measurable impact whatsoever. Economists suggest this inconclusiveness may be a result of inadequacy of the metrics. In particular, conflicting findings are often related to the inherent difficulty in defining and measuring value. These debates are riddled with theoretical and philosoph...

I examine how mergers affect performance in network industries. Network providers choose quality for communication within the provider’s own network, quality for communication between providers’ networks, and output. Cross-border mergers provide firms an incentive to increase output because merged firms internalize positive network externalities. Several results modify conclusions in the curren...

We analyze the welfare impacts of price discrimination in a two-dimensional spatial differentiation model. Consumer information of varying qualities is available on one dimension which allows firms to price discriminate, and better information leads to more refined price discrimination. We find that as information quality improves, firms’ profits monotonically increase while consumer surplus an...

This paper examines the implications of “prominence” in search markets. We model prominence by supposing that the prominent firm will be sampled first by all consumers. If there are no systematic quality differences among firms, we find that the prominent firm will charge a lower price than its non-prominent rivals. The impact of making a firm prominent is that it will typically lead to higher ...

I analyse the effects of a downstream merger in a differentiated oligopoly when there is bargaining between downstream firms and upstream agents (firms or unions). Bargaining outcomes can be observable or unobservable by rivals. When competition is in quantities, upstream agents are independent and bargaining is over a uniform input price, a merger between downstream firms may raise consumer su...

The attributes that consumers anticipate or expect when choosing among alternatives (i.e., prior to consumption) often differ from the attributes that they actually experience when consuming their chosen alternative. This paper describes, and illustrates with several examples, the calculation of consumer surplus in this situation and the loss in consumer surplus due to the imperfect foreknowled...

I analyse the effects of downstream competition when there is bargaining between downstream firms and upstream agents (firms or unions). When bargaining is over a uniform input price, a decrease in the intensity of competition (or a merger) between downstream firms may raise consumer surplus and overall welfare. When bargaining is over a two-part tariff, a decrease in the intensity of competiti...

The influence of firms’ ability to employ individualized pricing on the welfare consequences of horizontal mergers is examined in location models. In a two-to-one merger, the merger reduces consumer surplus more when firms can price discriminate based on individual preferences compared to when they cannot. However, the opposite holds true in a three-to-two merger, in which the reduction in cons...