Collusive pricing with capacity constraints in the presence of demand uncertainty
Article Abstract:
The study attempts to illustrate the relation between demand conditions and a firm's maintenance of tacit collusion. Tacit collusions tend to break down when the business climate is poor. The model is most applicable to firms with high capacity costs and to whom capacity constraints are crucial. Price wars are a result of market instability caused by ineffective collusions and depend largely on the degree of excess capacity. Mild price wars are when there are uniform price reductions and market share stability. Severe price wars are characterized by price cutting and market share instability.
Publication Name: RAND Journal of Economics
Subject: Economics
ISSN: 0741-6261
Year: 1992
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Globalization and emerging markets: with or without crash?
Article Abstract:
Emerging markets and financial globalization are analyzed with emphasis on the former's inclination to be involved in demand-based financial crises. These crises are evaluated, particularly the collapse in demand for goods.
Publication Name: American Economic Review
Subject: Economics
ISSN: 0002-8282
Year: 2006
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