Bargains Followed by Bargains: When Switching Costs Make Markets More Competitive

In markets where consumers have switching costs and firms cannot price‐discriminate, firms have two conflicting strategies. A firm can either offer a low price to attract new consumers and build future market share or a firm can offer a high price to exploit the partial lock‐in of their existing consumers. This paper develops a theory of competition when overlapping generations of consumers have switching costs and firms produce differentiated products. Competition takes place over an infinite horizon with any number of firms. This paper shows that the relationship between the level of switching costs, firms' discount rate, and the number of firms determines whether firms offer low or high prices. Similar to previous duopoly studies, switching costs are likely to facilitate lower (higher) equilibrium prices when switching costs are small (large) or when a firm's discount rate is large (small). Unlike previous studies, this paper demonstrates that the number of firms also determines whether switching costs are pro‐ or anticompetitive, and with a sufficiently large (small) number of firms switching costs are pro‐ (anti‐) competitive.     

Pay to Switch or Pay to Stay: Preference-Based Price Discrimination in Markets with Switching Costs

In many markets, firms can price discriminate between their own customers and their rivals' customers, charging one price to consumers who prefer their own product and another price to consumers who prefer a rival's product. We find that when demand is symmetric, charging a lower price to a rival's customers is always optimal. When demand is asymmetric, however, it may be more profitable to charge a lower price to one's own customers. Surprisingly, price discrimination can lead to lower prices to all consumers, not only to the group that is more elastic, but also to the less elastic group.     

一种考虑供应商转换成本的多期供应商选择模型

为解决供应链中多期多种产品的供应商选择问题,对现有的供应商选择模型进行了改进,综合考虑供应商供应能力、交货提前期等限制,以及供应商转换成本、交易成本和批量库存成本对供应商选择方案的影响,建立了混合整数规划模型,以确定每个时期每种产品的最优供应商选择方案及供应量,并通过实际算例验证了模型的有效性。     

Differentiation-Induced Switching Costs and Poaching

We show that the presence of sufficiently significant switching costs, which are increasing in the degree of product differentiation, generates an equilibrium configuration with maximal differentiation within the framework of a Hotelling model with linear transportation costs. The equilibrium with maximal differentiation offers a formalization of the idea that competing firms have noncooperative incentives to establish maximal switching cost barriers. The equilibrium incentives for commitments to high switching costs can be explained with poaching profits, which are increasing in the switching costs. Ex ante competition for market shares in period 1 is unable to eliminate these poaching profits .     

Strategic Product Choiceand Niche Markets

This paper presents a model of strategic product choice when consumer preferences combine features of both horizontal and vertical product differentiation. Consumers disagree on what amount of a "special" characteristic makes for a better product, but those who prefer more of this attribute are willing to pay more for it. Within this demand structure, I examine the advantages of first-mover firms. I find that such firms typically do best in markets where the maximum degree of product differentiation is limited by preferences rather than technology. These are "niche markets". Follower firms do better in markets in which the range of preferences is broad relative to the span of feasible goods.     

Statistical Causality and Strategic Behavior in Industrial Markets

This paper proposes a simple test of the leader-follower model of strategic behavior. This test relates the temporal notions of leadership central to such models to the empirical methods of statistical causality. This test is performed using data from the US softwood plywood industry of the last three decades. Others have productively explored the spatial pricing practices of this industry by applying a leader-follower model. Similarly, we find that a leader-follower model explains well the temporal relations between key strategic variables (prices) in the industry. We conclude that the leader-follower model imposes meaningful restrictions on observable time-series data and that statistical causality is a useful method for testing these restrictions.     

Product Switching Cost and Strategic Flexibility

This paper examines the equilibrium degree of flexibility adopted by firms competing in oligopolistic product markets in which the value of flexibility arises from the initial presence of uncertainty over consumer preferences and its eventual resolution. The equilibrium choice of flexible mode depends on the following factors: (1) the cost of switching product design in response to revealed consumer preferences, (2) the difference in the acquisition costs of the flexible and dedicated modes, and (3) the precision of the ex ante information held by the firms regarding consumer preferences. The relationship between these factors and the equilibrium choice of modes is fully characterized.     

产品差异、转移成本和创新激励

文章在豪泰林空间差异化模型的基础上构建了静态完全信息博弈模型,研究转移成本和生产成本对市场竞争产生的影响以及转移成本下企业的创新激励。     

Disclosure Regulation in Duopoly Markets: Proprietary Costs and Social Welfare

Abstract

The argument of proprietary costs is commonly used by firms to object against proposed disclosure regulations. The goal of this paper is to improve our understanding of the welfare consequences of disclosure in duopoly markets and to identify market settings where proprietary costs are a viable argument for firms to remain silent. We, therefore, solve the optimal disclosure strategies and distinguish two different potentially costly effects of disclosing private information: the strategic information effect and the market information effect. We identify the market settings for which a regulator prefers to impose disclosure regulation so as to maximise consumer surplus or total surplus. Regulation may be necessary because (i) the increase in welfare outweighs proprietary costs to the firms, or (ii) firms are trapped in a prisoners' dilemma. The first primarily applies to Bertrand competition with demand uncertainty and, to a lesser extent, to Cournot competition. The second applies primarily to Cournot competition and Bertrand competition with cost uncertainty.     

The Strategic Interplay Between Bundling and Merging in Complementary Markets

In this paper, the firms within two pairs of complementors decide whether to merge and eventually bundle their products. Depending on the competitive pressure in the market, either the firms within both pairs merge, with or without bundling, or only one pair merges and bundles, whereas the other one remains independent. The latter case can be harmful for consumers as overall prices surge. We also consider the case where a pair moves before the other. Interestingly, we find a parametric region where the first movers merge, but refrain from bundling, to not induce rivals to merge as well. Copyright © 2014 John Wiley & Sons, Ltd.     

How Strategic Groups Act Competitively Within and Across Markets

Our study analyzes rivalry within and across markets of size‐defined strategic groups in the banking industry. We consider that, owing to group‐level effects, like efficiency and funding, the degree of rivalry of size‐defined strategic groups depends on whether the competitor is acting in the same or in a different market and whether the competing firms are within the same strategic group or in different groups. We estimate the effect of group interactions within and across loans and deposits markets on firm performance in the Spanish banking industry. We find evidences of rivalry as described in our hypotheses. Copyright © 2017 John Wiley & Sons, Ltd.     

Strategic Corporate Social Responsibility Activities and Corporate Governance in Imperfectly Competitive Markets

We investigate the incentives of firms' owners to commit voluntarily to corporate social responsibility (CSR) activities in an oligopolistic market. The socially responsible attributes attached to products are considered as credence goods, with consumers forming expectations about their existence and level. We show that hiring an ‘individually’ socially responsible CEO and delegating to him the CSR effort and market decisions acts as a commitment device for the firm's owners and credibly signals to consumers that the firm will undertake the ‘missioned’ CSR activities. We also find that CSR activities are welfare enhancing for consumers and firms and thus, they should be encouraged. Copyright © 2013 John Wiley & Sons, Ltd.     

Managerial Agency Costs of Socialistic Internal Capital Markets: Empirical Evidence from China

This study provides empirical evidence of managerial agency costs in socialistic internal capital markets. Listed Chinese companies are required to disclose the amount of resources that are reallocated to other firms of the parent company, which provides us with a direct measure of the socialistic subsidization of weak member firms by strong member firms within a business group. We hypothesize that in strong member firms, managerial compensation is less sensitive to firm performance because cross‐subsidization makes it difficult for group CEOs to hold the managers in strong firms accountable for their own firms' performance, and also increases the noise in performance measures. We also hypothesize that socialistic cross‐subsidization results in an increase in managerial agency costs of strong member firms due to the low pay‐performance sensitivity and low incentive to work hard. We document empirical results that are consistent with these two predictions.     

知识产品在线定制的交易成本分析及其治理机制研究

近期国内外出现了一批专注于知识产品定制交易的在线市场。虽然这些在线市场可以降低交易双方的搜索成本,但面临着由各种因素引发的高交易成本的挑战。文章从知识产品在线定制交易的特点出发,刻画了此类交易中主要的交易成本因素,构造了一个交易成本分析框架,并基于该框架讨论了可用的交易成本治理机制,最后观察了国内外三个典型的知识产品在线定制市场的交易成本治理实践。文章为知识产品在线定制的市场设计和管理提供了理论指导和实践经验。     

价值链分析在战略成本管理中的应用研究

价值链分析是战略成本管理的首要步骤,但目前对价值链的研究仅限于理论探讨。如何具体展开价值链分析,仍是一个难题。本文从价值链分析出发,探讨了企业寻求成本竞争优势的战略途径,提出了价值链的分解与整合,有利于提高企业的战略成本竞争优势,形成企业的核心竞争力。     

Interfirm and Intrafirm Switching Costs in a Vertical Differentiation Setting: Green versus Nongreen Products

In a vertical differentiation model where both duopolists supply the same two qualities of an otherwise homogeneous product, we derive the critical level of the interfirm switching cost needed to sustain monopoly pricing. In particular, we show how a decrease in the intrafirm switching cost may cause a decrease in this critical value, thereby facilitating monopoly pricing. We apply the results to a setting with green and nongreen products—in particular electricity—and discuss implications for policy measures intended to stimulate the production and consumption of green products.     

转换成本、网络规模与信用卡产业竞争策略比较

近年来,我国信用卡产业呈现出市场集中度逐年下降的趋势。信用卡市场的竞争融合了网络效应、兼容性及转换成本等因素,而在兼容性一定的环境下,不同银行的竞争策略往往不同。本文通过防降价均衡模型估计出2010—2012年我国九家上市银行的信用卡转换成本,并对网络规模扩张、转换成本定位以及竞争成效等进行分组比较。结果表明,股份制商业银行利用较低的转换成本吸引新客户,实现了更高的业务规模增长率;四大国有商业银行则利用高转换成本锁定其已有客户,并以高速扩张网络规模来竞争新客户,使其同股份制商业银行的业务规模增长率差异逐年下降。这说明网络产业中不同市场地位的厂商可将转换成本定位与网络规模扩张作为差异化策略,以此实现竞争优势。     

基于低碳经济发展约束的企业战略选择

企业转型低碳经济面临着多重约束:经营自然环境约束、国际和国内经营规则环境约束、市场价格和市场需求环境约束。企业要善于抓住低碳经济发展的战略机遇;深入梳理低碳经济战略投资机会线路图;努力解决低碳经济发展信息的不对称问题;尽量争取政府的低碳经济发展扶植政策;及时构建低碳技术创新的联盟平台,以保证企业发展低碳经济。     

加快完善要素市场,推动经济结构战略性调整

中国生产要素市场化改革滞后,土地、资本、劳动力、技术、资源等要素的市场体系不完善,在城乡、部门、行业、区域之间分割,价格扭曲,在一定程度上引发内外需求结构失衡,同时还对产业结构优化升级和城乡区域协调发展产生逆向调节作用。推动经济结构战略性调整,必须加快土地、劳动力、能源资源的市场化改革,完善金融市场,加强技术要素制度创新和市场体系建设,形成产权清晰、功能完善、流动顺畅的现代要素市场体系。