Cheap talk and investment rivalry in the pulp and paper industry

Article Abstract:

There are several determinants of investment rivalry. These determinants form the basis for firms' decisions regarding the abandonment of previously announced capacity expansions within the North American pulp and paper industry. The determinants include the investor's initial confidence, the extent of committed resources and the announcement of fresh news. The announcement of unanticipated projects by rival firms also increases the probability of investment abandonment.

PAPER AND ALLIED PRODUCTS, Paper & Allied Products, Paper Manufacturing, Economic aspects, Capital investments, Paper industry, North America

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Tight average revenue regulation can be worse than no regulation

Article Abstract:

Tight average revenue regulation can lead to a distortion in relative prices such that welfare becomes lower than it would have been if there was no regulation. This welfare distortion occurs because firms that are subject to price caps impose different sets of prices for different types of customers in response to the threat of competition. These effects of average revenue regulation and uniform pricing are manifested within the UK business scene.

Administration of General Economic Programs, Price & Wage Controls, United Kingdom, Price control, Price regulations, Wage price policy

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