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I consider a firm's choice between having people who carry out complementary tasks report to the same manager and having them report to separate, function‐based managers. Even supposing that the former enhances coordination, the latter may be preferred because it improves the firm's control over...
We show that price‐matching guarantees can facilitate monopoly pricing only if firms automatically match prices. If consumers must instead request refunds (thereby incurring hassle costs), we find that any increase in equilibrium prices due to firms' price‐matching policies will be small; often,...
This paper studies sales promotions through coupons in an oligopoly under imperfect price information. Sellers can distribute either ordinary coupons, or coupon (price) advertising, or both types of coupons, at distant locations to attract consumers from their rivals' markets. A unique symmetric...
In this model, insurance offering a choice of hospitals is valued because consumers are uncertain which hospital they will prefer ex post. A competitive insurance market facilitates tacit price collusion between hospitals; high margins induce hospitals to compete for customers through...
This paper analyzes the strategic incentive of oligopolists to create autonomous rival divisions when products are differentiated. We consider a two‐stage game where firms choose the number of autonomous divisions in the first stage and all the divisions engage in Cournot competition in the...
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