Price leadership in a duopoly with capacity constraints and product differentiation

This paper analyzes Stackelberg price leadership in a duopoly in which firms are capacity constrained and products are imperfect substitutes. Assuming symmetric substitutes, linear demand, and efficient rationing, we characterize the equilibria with an exogenously specified leader. Using the equilibrium profits derived from these games, we argue that over certain ranges of asymmetric capacities an endogenous price leader will emerge. When endogenous leadership does arise, it is the large capacity firm which is the leader. We thus provide a game theoretic model of dominant firm price leadership.Dave Furth's research has been undertaken as a part of the project Competition and Cooperation. Dan Kovenock has benefited from financial support from Erasmus University Rotterdam, the Krannert School of Management, and the Jay N. Ross Young Faculty Research Fellowship. We are grateful to Tom Faith for valuable research assistance. We have benefited from the comments of the editor, two anonymous referees, and participants at the European meetings of the Econometric Society in September 1989 and the North American Winter Meetings of the Econometric Society in December 1989.     

Versicherungsvertragliche Anzeigepflicht und Garantiehaftung für culpa in contrahendo

To sanction the insurant’s obligation to disclose the risk-relevant circumstances by the insurer’s exemption from performance does not comply with the ordinary pattern of pre-contractual liability. Instead of making the insurant responsible for the consequences of his breach of duty, the German Insurance Act subjects him to a guarantee which is comparable to the one imposed by the German Civil Code in the case of initial impossibility. The insurant has to guarantee that the facts which he did not, or at least not entirely, disclose do not cause any obligation of the insurer. The structure of this sanction is equivalent to the insurer’s so-called liability of performance. But contrary to the latter it can be justified by the specific importance of the insurant’s pre-contractual obligation of disclosure.     

Traumberuf oder Verlegenheitslösung?

So far relatively little is known about the situation of Ph.D. students in media and communication research. The main purpose of this study is, therefore, to shed light on the employment and working conditions for young scholars on their way to their doctoral degrees. We conducted a survey of 281 Ph.D. students in Germany, Switzerland and Austria. The results show that, on the one hand, young scholars are intrinsically highly motivated to do their jobs. On the other hand, they perceive an academic career as a very uncertain venture with many obstacles. Furthermore, several types of Ph.D. students can be distinguished: idealists, careerists and waverers. It is shown that only the idealists conform to the concept of a productive and interested scholar. The results are discussed in terms of their importance for the future development of the field.     

What Causes the Positive Price-Turnover Correlation in European Housing Markets?

This paper examines what determines the correlation between prices and turnover in European housing markets. Using a panel vector autoregressive model, we find that there is a particularly strong feedback mechanism between prices and turnover. Momentum effects are another important reason why prices and turnover are correlated. Common underlying factors, such as GDP and interest rates, also explain part of the price-turnover correlation. The results in this paper imply that, to understand price and turnover dynamics, it is important to model prices and turnover as two interdependent processes. There is a considerable bias in the coefficient estimates of standard house price models if this dependency is not explicitly taken into account.