Price and service competition with maintenance service bundling

In many equipment manufacturing industries, firms compete with each other not only on products price, but also on maintenance service. More and more traditional products oriented firms are offering their customers products bundled with maintenance service (P&S bundles). In this study, we examine firms’ incentive to offer customers products bundling with long-term maintenance or repair support service in a duopoly competitive environment. When providing P&S bundles, a firm need to determine the service level (in terms of average response time guarantee for the service in this paper) to offer and needs to build a service facility to handle the maintenance service requirements. Based on the analysis of three sub-game models, we characterize the market conditions in which only one firm, both firms or neither firm will offer P&S bundles. Finally, we analyze the affects of several market factors on firms’ strategy choices

Innovation and Crowdsourcing Contests

In an innovation contest, an organizer seeks solutions to an innovation-related problem from a group of independent agents. Agents, who can be heterogeneous in their ability levels, exert efforts to improve their solutions, and their solution qualities are uncertain due to the innovation and evaluation processes. In this chapter, we present a general model framework that captures main features of a contest, and encompasses several existing models in the literature. Using this framework, we analyze two important decisions of the organizer: a set of awards that will be distributed to agents and whether to restrict entry to a contest or to run an open contest. We provide a taxonomy of contest literature, and discuss past and current research on innovation contests as well as a set of exciting future research directions

The all-pay-auction with complete information

In a (first price) all-pay auction, bidders simultaneously submit bids for an item. All players forfeit their bids, and the high bidder receives the item. This auction is widely used in economics to model rent seeking, R&D races, political contests, and job promotion tournaments. We fully characterize equilibrium for this class of games, and show that the set of equilibria is much larger than has been recognized in the literature. When there are more than two players, for instance, we show that even when the auction is symmetric there exists a continuum of asymmetric equilibria. Moreover, for economically important configurations of valuations, there is no revenue equivalence across the equilibria; asymmetric equilibria imply higher expected revenues than the symmetric equilibrium

Understanding Interorganizational Learning Based on Social Spaces and Learning Episodes

Different organizational settings have been gaining ground in the world economy, resulting in a proliferation of different forms of strategic alliances that translate into a growth in the number of organizations that have started to deal with interorganizational relationships with different actors. These circumstances reinforce Crossan, Lane, White and Djurfeldt (1995) and Crossan, Mauer and White (2011) in exploring what authors refer to as the fourth, interorganizational, level of learning. These authors, amongst others, suggest that the process of interorganizational learning (IOL) warrants investigation, as its scope of analysis needs widening and deepening. Therefore, this theoretical essay is an attempt to understand IOL as a dynamic process found in interorganizational cooperative relationships that can take place in different structured and unstructured social spaces and that can generate learning episodes. According to this view, IOL is understood as part of an organizational learning continuum and is analyzed within the framework of practical rationality in an approach that is less cognitive and more social-behavioral