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This paper estimates the importance of indirect network effects in the US video cassette recorder (VCR) market between 1978 and 1986. Estimation reveals the significant role of networks in the format competition between VHS and Beta. The paper also finds that if Sony, the system sponsor of Beta,...
We analyze the interactions between internal and external control mechanisms in a framework in which the board selects the CEO and then decides whether to retain or dismiss him after observing a signal regarding his ability. The novel aspect of our paper is that we consider both the hiring and...
We consider a repeated interaction between a manufacturing firm and a subcontractor. The relationship between the two parties is characterized (1) by moral hazard, and (2) by the fact that they do not have perfect knowledge about the base cost level of the project, which is carried out by a...
We examine bargaining in a dynamic context where exchange between two parties affects the potential surplus from future trade. In this setting traders negotiate current contracts anticipating the impact of their agreement on future exchanges. We show that in growing environments these dynamic...
This paper applies spatial econometrics to hamburger price data to assess the degree of substitutability of products and locations of spatially dispersed franchised chains. First, while intrachain price variation exists, I find that hamburger prices at neighboring outlets of different chains are...
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