Profit-Sharing in a Collusive Industry,
Abstract
The author studied a model in which collusive duopolists divide up the monopoly profit according to their relative bargaining power. They are particularly interested in how the negotiated profit shares depend on the sizes of the firms. If each can produce at the same constant unit cost up to its capacity, we show that the profit per unit of capacity of the small firm is higher than that of the large one. also studied is how the ratio of the negotiated profits depends on the size of demand relative to industry capacity, and how this ratio changes with variations in demand. (Author)
Document Details
- Document Type
- Technical Report
- Publication Date
- Jun 09, 1983
- Accession Number
- ADA131220
Entities
People
- Carolyn Pitchik
- Martin J. Osborne
Organizations
- Yale University