Complementary Patents and Market Structure

Many high technology goods are based on standards that require several essential patents owned by different IP holders. This gives rise to a complements and a double mark-up problem. We compare the welfare effects of two different business strategies dealing with these problems. Vertical integration of an IP holder and a downstream producer solves the double mark-up problem between these firms. Nevertheless, it may raise royalty rates and reduce output as compared to non-integration. Horizontal integration of IP holders solves the complements problem but not the double mark-up problem. Vertical integration discourages entry and reduces innovation incentives, while horizontal integration always benefits from entry and innovatio

Market Structure of the Corn Seed Industry in East Java

IndonesianMakalah ini menelaah tentang struktur pasar industri benih jagung di Jawa Timur. Struktur pasar di tingkat produsen sangat oligopolistik yang mana volume penjualan didominasi oleh produk beberapa Perusahaan multinasional berupa benih jagung hibrida. Pengemasan dan jenis varietas merupakan indikator utama diferensiasi produk. Semua produsen memperoleh informasi pasar secara memadai. Investasi yang cukup tinggi merupakan penghalang utama untuk masuk dan pangsa pasar yang sudah mapan merupakan faktor utama untuk meninggalkan industri ini. CR4 di tingkat pedagang menunjukkan bahwa pedagang besar-pengecer bersifat oligopolistik, tetapi pengecer relatif bersaing. Mendorong investor baru untuk masuk ke dalam industri benih merupakan pilihan kebijakan pemerintah yang bisa mengurangi konsentrasi produsen yang relatif tinggi dalam industri ini.EnglishThis study attempted to describe market structure of the corn seed industry in East Java. Market structure of the industry at the producer level was highly oligopolistic characterized by dominant volume of sales of few multinationals through their hybrid corn seed products. Packaging and types of varieties were the main indicators of product differentiation. All producers were well informed about the market. High capital investment was the main barrier to entry and established market share was the most important barrier to exit. CR4 at the traders' level showed that the wholesaler-retailers were oligopolistic, but the retailers were relatively competitive. Encouraging new investors to entry into the corn seed industry is the policy the government can take to reduce high concentration in this industry

Underinvestment and Market Structure

This paper analyses a dynamic game of investment in R&D or advertising, where current investments change future market conditions. It investigates whether underinvestment can be supported in equilibrium by the threat of escalation in investment outlays. When there are no spillovers, or there is full patent protection, underinvestment equilibria are shown to exist even though, by deviating, a firm can get a persistent strategic advantage. When there are strong spillovers and weak patent protection, underinvestment equilibria fail to exist. This implies that weaker patent protection can actually lead to more investment in equilibrium. Furthermore, potential entry is introduced into the model so as to address the issues of market structure. It is shown that underinvestment equilibria can be stable with respect to further entry, independently of market size and entry costs. Finally, the 'nonfragmentation' result of static stage games is proved to hold in this dynamic game.Dynamic games, investment, collusion, industry structure

Globalisation and Market Structure

This paper reviews some puzzling economic aspects of globalisation and argues that they cannot be satisfactorily addressed in perfectly or monopolistically competitive models. Drawing on recent work, a model of oligopoly in general equilibrium is sketched. The model ensures theoretical consistency by assuming that firms are large in their own markets but small in the economy as a whole, and ensures tractability by assuming quadratic preferences defined over a continuum of goods. Applications considered include the effects of trade liberalisation on industrial structure, on cross-border merger waves, and on the distribution of income between skilled and unskilled workers.Cross-border mergers; GOLE (General Oligopolistic Equilibrium); market integration; trade and wages; trade liberalisation

Implementing Efficient Market Structure

This article studies the design of optimal mechanisms to regulate entry in natural oligopoly markets, assuming the regulator is unable to control the behavior of firms once they are in the market. We adapt the Clark-Groves mechanism, characterize the optimal mechanism that maximizes the weighted sum of expected social surplus and expected tax revenue, and show that these mechanisms generally avoid budget deficits and prevent excessive entry.Mechanism design, natural oligopoly, auctions, entry

Implementing Efficient Market Structure

This article studies the design of optimal mechanisms to regulate entry in natural oligopoly markets, assuming the regulator is unable to control the behavior of firms once they are in the market. We adapt the Clarke--Groves mechanism, characterize the optimal mechanism that maximizes the weighted sum of expected social surplus and expected tax revenue, and show that these mechanisms generally avoid budget deficits and prevent excessive entry.

Market Structure of Yam in Selected Market in Ibadan, Oyo State, Nigeria

This study carried out Market Structure of Yam in selected markets in Ibadan. Oyo State, It specifically determined profitability of Yam marketing and examined the market structure for yam in the study area. Five markets centres were covered and simple random sampling techniques wereused to select a total of 120 yam sellers in the study area. Gross margin and gini-coefficient techniques were used to analyse the data collected. The profitability analysis showed that yammarketing in Bodija is more profitable as the seller on the average realizes a net profit of N111,075. The result of the Gini coefficient for yam sellers obtained in the study area was 0.572 which implies that yam market in the study area is imperfectly competitive with the market structure inclining towards monopoly

Liquidity and Market Structure

Market liquidity is modeled as being determined by the demand and supply of immediacy. Exogenous liquidity events coupled with the risk of delayed trade create a demand for immediacy. Market makers supply immediacy by their continuous presence. and willingness to bear risk during the time period between the arrival of final buyers and sellers. In the long run the number of market makers adjusts to equate the supply and demand for immediacy. This determine the equilibrium level of liquidity in the market. The lower is the autocorrelation in rates of return, the higher is the equilibrium level of liquidity.

Market Structure and Communicable Diseases

Communicable diseases pose a formidable challenge for public policy. Using numerical simulations, we show under which scenarios a monopolist’s price and prevalence paths converge to a nonzero steady-state. In contrast, a planner typically eradicates the disease. If eradication is impossible, the planner subsidizes treatments as long as the prevalence can be controlled. Drug resistance exacerbates the welfare difference between monopoly and first best outcomes. Nevertheless, because the negative externalities from resistance compete with the positive externalities of treatment, a mixed competition/monopoly regime may perform better than competition alone. This result has important implications for the design of many drug patents.communicable disease, resistance, epidemiology, patent