VERTICAL INTER-FIRM INTERACTIONS IN MARKETS WITH A DOMINANT POSITION OF INDIVIDUAL ECONOMIC AGENTS
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VERTICAL INTER-FIRM INTERACTIONS IN MARKETS WITH A DOMINANT POSITION OF INDIVIDUAL ECONOMIC AGENTS
Annotation
PII
S042473880000616-6-1
Publication type
Article
Status
Published
Edition
Pages
3-15
Abstract
A model of sequential oligopolies is developed, taking into account the strategic nature of the firm’s interactions in the product markets, imperfections in financial markets, and the effects of fiscal policy on firm’s decisions. The “leader–follower” strategic interaction in quantity choice of the output is studied, and an explicit solution is obtained in the case of constant marginal cost and linear demand. The analysis also examines the effect of a firm’s dominant position on: the prices and quantities of intermediate and final goods depending on the competitive environment; the level of organization of the financial system; and the parameters of fiscal policy.
Date of publication
01.01.2008
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