Second-Hand Markets and Collusion byManufacturers of Semidurable Goods

The focus of the present work is to study the impact of the second-hand market the collusivebehavior. I analyze firms' preferences for having an active second-hand market and whetherpolicies (i.e. leasing policy, buy-back policy and warranty policy) that affect the functioningof the second-hand market strengthen collusion. I show how collective incentives to adoptstrategies that strengthen collusion often differ from monopoly incentives to achieve higherprofits.Bertrand competition, buy-back policies, collusion, leasing, semi-durability,second-hand market, warranty.

The flexible coefficient multinomial logit (FC-MNL) model of demand for differentiated products

We show FC-MNL is flexible in the sense of Diewert (1974), thus its parameters can be chosen to match a well-defined class of possible own- and cross-price elasticities of demand. In contrast to models such as Probit and Random Coefficient-MNL models, FC-MNL does not require estimation via simulation; it is fully analytic. Under well-defined and testable parameter restrictions, FC-MNL is shown to be an unexplored member of McFadden’s class of Multivariate Extreme Value discrete-choice models. Therefore, FC-MNL is fully consistent with an underlying structural model of heterogeneous, utility-maximizing consumers. We provide a Monte-Carlo study to establish its properties and we illustrate the use by estimating the demand for new automobiles in Italy

Sales and Collusion in a Market with Storage

Sales are a widespread and well-known phenomenon that has been documented in several product markets. Regularities in such periodic price reductions appear to suggest that the phenomenon cannot be entirely attributed to random variations in supply, demand, or the aggregate price level. Certain sales are traditional and so well publicized that it is difficult to justify them as devices to separate informed from uninformed consumers. This paper presents a model in which sellers want to reduce prices periodically in order to improve their ability to collude over time. In particular, the study shows that if buyers have heterogeneous storage technologies, periodic sales may facilitate collusion by magnifying intertemporal linking in consumers' decisions. The stability and the profitability of different sale strategies is then explored. The optimal sales discount and timing of sales are characterized. A trade-off between cartel size and aggregate profits arises.Storage, sales, collusion, cartel size, repeated games

Automobile Replacement: A DynamicStructural Approach

This paper specifies and estimates a structural dynamic model of consumer demand for newand used durable goods. Its primary contribution is to provide an explicit estimationprocedure for transaction costs, which are crucial to capturing the dynamic nature ofconsumer decisions. In particular, transaction costs play a key role in determining consumerreplacement behavior in both primary and secondary markets for durable goods. The uniquedata set used in this paper has been collected by the Italian Motor Registry and covers theperiod from 1994 to 2004. It includes information about sales dates for individual cars overtime as well as the initial stock of cars in the sample period. Identification of transactioncosts is achieved from the variation in the share of consumers choosing to hold a given cartype each period, and from the share of consumers choosing to purchase the same car typethat period. Specifically, I estimate a random coefficients discrete choice model thatincorporates a dynamic optimal stopping problem in the spirit of Rust (1987). I apply thismodel to evaluate the impact of scrappage subsidies on the Italian automobile market in 1997and 1998.

Multi-category competition and market power: a model of supermarket pricing

In many competitive settings consumers buy multiple product categories, and some prefer to use a single firm, generating complementary cross-category price effects. To study pricing in supermarkets, an organizational form where these effects are internalized, we develop a multi-category multi-seller demand model and estimate it using UK consumer data. This class of model is used widely in theoretical analysis of retail pricing. We quantify crosscategory pricing effects and find that internalizing them substantially reduces market power. We find that consumers inclined to one-stop (rather than multi-stop) shopping have a greater pro-competitive impact because they generate relatively large cross-category effect

On monotone strategy equilibria in simultaneous auctions for complementary goods

We explore existence and properties of equilibrium when N ≥ 2 bidders compete for L ≥ 2 objects via simultaneous but separate auctions. Bidders have private combinatorial valuations over all sets of objects they could win, and objects are complements in the sense that these valuations are supermodular in the set of objects won. We provide a novel partial order on typesunder which best replies are monotone, and demonstrate that Bayesian Nash equilibria which are monotone with respect to this partial order exist on any finite bid lattice. We apply this result to show existence of monotone Bayesian Nash equilibria in continuous bid spaces when a single global bidder competesfor L objects against many local bidders who bid for single objects only. Wethen consider monotone equilibrium with endogenous tiebreaking building onJackson, Simon, Swinkels and Zame (2002), and demonstrate that these existin general. These existence results apply to many auction formats, including first-price, second-price, and all-pay

Differentiated durable goods monopoly: a robust Coase conjecture

The paper analyzes a durable goods monopoly problem in which multiple varieties can be sold. A robust Coase conjecture establishes that the market eventually clears, with profits exceeding static optimal market-clearing profits and converging to this lower bound in all stationary equilibria with instantaneous price revisions. Pricing need not be efficient, nor is it minimal (equal to the maximum of marginal cost and minimal value), and can lead to cross-subsidization. Conclusions nest both classical Coasian insights and modern Coasian failures. The option to scrap products does not affect results qualitatively, but delivers a novel motive for selling high cost products

Polydatin Incorporated in Polycaprolactone Nanofibers Improves Osteogenic Differentiation

Polycaprolactone nanofibers are used as scaffolds in the field of tissue engineering for tissue regeneration or drug delivery. Polycaprolactone (PCL) is a biodegradable hydrophobic polyester used to obtain implantable nanostructures, which are clinically applicable due to their biological safety. Polydatin (PD), a glycosidic precursor of resveratrol, is known for its antioxidant, antitumor, antiosteoporotic, and bone regeneration activities. We aimed to use the osteogenic capacity of polydatin to create a biomimetic innovative and patented scaffold consisting of PCL-PD for bone tissue engineering. Both osteosarcoma cells (Saos-2) and mesenchymal stem cells (MSCs) were used to test the in vitro cytocompatibility of the PD-PCL scaffold. Reverse-phase (RP) HPLC was used to evaluate the timing release of PD from the PCL-PD nanofibers and the MTT assay, scanning electron microscopy, and alkaline phosphatase (ALP) activity were used to evaluate the proliferation, adhesion, and cellular differentiation in both osteosarcoma and human mesenchymal stem cells (MSCs) seeded on PD-PCL nanofibers. The proliferation of osteosarcoma cells (Saos-2) on the PD-PCL scaffold decreased when compared to cells grown on PLC nanofibers, whereas the proliferation of MSCs was comparable in both PCL and PD-PCL nanofibers. Noteworthy, after 14 days, the ALP activity was higher in both Saos-2 cells and MSCs cultivated on PD-PCL than on empty scaffolds. Moreover, the same cells showed a spindle-shaped morphology after 14 days when grown on PD-PCL as shown by SEM. In conclusion, we provide evidence that nanofibers appropriately coated with PD support the adhesion and promote the osteogenic differentiation of both human osteosarcoma cells and MSCs