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- W2185718099 abstract "The paper compares linear prices and bilateral contracts as selling procedures for a dominant firm in the presence of a fringe. When a buyer is served by the dominant firm, a contract establishes an efficient relationship between them; the number of buyers that the dominant firm chooses to serve, however, is inefficiently low. Consumers are always worse off with contracts than with linear prices, whereas the effect on total welfare is ambiguous and depends on the specific values of the parameters that characterize the industry. Finally, it is shown the dominant firm has incentives to consolidate the industry, exacerbating the effects of contracts on welfare." @default.
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- W2185718099 date "2010-01-01" @default.
- W2185718099 modified "2023-10-02" @default.
- W2185718099 title "Linear prices vs. contracts for a dominant firm" @default.
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