Endogenous timing with price competition when a public firm supplies a private rival
DOI:
https://doi.org/10.24275/uam/azc/dcsh/ae/2025v40n103/FernandezKeywords:
Endogenous timing, Mixed duopoly , Price competition , Dual supply channel , Vertically integrated producerAbstract
We study the endogenous order of firms’ moves in a price-setting mixed duopoly where a public firm not only competes with a private firm in the retail market but also supplies an input to such rival. Markets where the traditional separation between firms selling to ultimate consumers and their suppliers is not observed, as in the framework studied here, are common in practice. We focus on the usual case where the input price is regulated and find that the traditional result of simultaneous price setting may not hold, and sequential price setting is instead likely to emerge in a wide variety of circumstances.
JEL Classification: L13, L32, L30
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