The traditional problem often called “electricity development” is to improve and expand services from an established monopolistic electricity supplier. The lack of an effective dominant utility, however, is a defining condition for the 1.4 billion people without access for electricity, the so-called unserved. Therefore, the issues that arise are different from those of traditional utility servi...

This paper investigates the question of how much information firms can acquire about the demand for their product when they learn from experience (i.e., from data about past sales and prices). The main issues are whether firms will eventually learn everything about the demand curve and how learning considerations affect the pricing decisions of firms. It is shown that even when the demand is de...

We describe the behaviour of a monopolist supplying a vertically di¤erentiated good with network externalities. Assuming a ...xed cost of quality improvements, we show that the presence of network externalities enhances the incentive to expand output associated with scale economies. Although the quality distortion operated by the monopolist increases with network externalities, the output expan...

This paper presents a simple game theoretic framework, assuming complete information, to model Bitcoin mining activity. It does so by formalizing the activity as an all-pay contest: a competition where participants contend with each other to win a prize by investing in computational power, and victory is probabilistic. With at least two active miners, the unique pure strategy Nash equilibrium o...

The 1996 Telecommunications Act opened the monopolistic U.S. local telephone industry to new entrants. However, substantial entry costs have prevented some markets from becoming competitive. We study various subsidy policies designed to encourage entry. We estimate a dynamic entry game using data on both potential and actual entrants, allowing for heterogeneous option values of waiting. We find...

This paper extends the standard monopoly quality differentiation model by Mussa and Rosen (1978) to an environment where the production of a (qualitydifferentiated) product-line involves initial fixed investments in common assets such as production facilities or R&D. The fixed cost depends solely on the level of the highest quality, and the invested asset is shared among all the qualities in th...

An impatient, risk-neutral monopolist must sell one unit of an indivisible good within a fixed number of periods while one-period-lived buyers with independent private values arrive over time. In each period, the seller can either run a reserve price auction while incurring a cost or post a price without the cost. We characterize the optimal sequence of mechanisms that maximizes the seller’s ex...

We construct a competitive model of innovation and growth under constant returns to scale. Previous models of growth under constant cannot model technological innovation. Current models of endogenous innovation rely on the interplay between increasing returns and monopolistic markets. In fact, established wisdom claims monopoly power to be instrumental for innovation and sees the non-rivalrous ...

M disclose quality information directly to potential consumers using a variety of communication channels. This study investigates how competition may influence duopoly firms’ incentive to voluntarily reveal quality information. We show that firms in competitive markets reveal less information than a monopoly firm. In addition, sequential disclosure leads to asymmetric equilibrium disclosure beh...