Price vs. quantity competition in a vertically related market

Alipranti, Maria, Milliou, Chrysovalantou and Petrakis, Emmanuel (2014). Price vs. quantity competition in a vertically related market. Economics Letters, 124 (1), pp. 122-126.

Abstract

This paper demonstrates that the standard conclusions regarding the comparison of Cournot and Bertrand competition are reversed in a vertically related market with upstream monopoly and trading via two-part tariffs. In such a market, downstream Cournot competition yields higher output, lower wholesale prices, lower final prices, higher consumers' surplus, and higher total welfare than Bertrand competition.

Publication DOI: https://doi.org/10.1016/j.econlet.2014.05.002
Divisions: Aston Business School
Aston Business School > Economics finance & entrepreneurship
Uncontrolled Keywords: Bertrand,Cournot,Two-part tariffs,Vertical relations,Economics and Econometrics,Finance
Full Text Link: https://www.eco ... dle/10419/96924
Related URLs: http://www.scop ... tnerID=8YFLogxK (Scopus URL)
https://www.sci ... 1694?via%3Dihub (Publisher URL)
Published Date: 2014-07-01
Authors: Alipranti, Maria
Milliou, Chrysovalantou
Petrakis, Emmanuel

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