Exercising Market Power in Proprietary Aftermarkets

Abstract

Over 20 recent antitrust cases have turned on whether competition in complex durable‐equipment markets prevents manufacturers from exercising market power over proprietary aftermarket products and services. We show that the price in the aftermarket will exceed marginal cost despite competition in the equipment market. Absent perfectly contingent long‐term contracts, firms will balance the advantages of marginal‐cost pricing to future generations of consumers against the payoff from monopoly pricing for current, locked‐in equipment owners. The result holds for undifferentiated Bertrand competition, differentiated duopoly, and monopoly equipment markets. We also examine the effects of market growth and equipment durability.

Population genetic structure of Tunisian Hypericum humifusum assessed by RAPD markers

“…Our results were similar to those reported for other Hypericum species (Quintana-Ascencio et al 1998). The low gene flow and the high differentiation among metapopulations has been explained mainly by founder events such as time since colonization (Jacquemyn et al 2004), number of initial founders in populations and their reproductive and dispersal potentials (Coleman & Abbott 2003).…”

A Fire‐Explicit Population Viability Analysis of Hypericum cumulicola in Florida Rosemary Scrub

“…H. cumulicola is self-compatible but requires the services of pollinators to set seed (Evans et al, in press). Fire kills aboveground individuals (Menges & Kohfeldt 1995;Quintana-Ascencio & Morales-Hernández 1997 ), but seeds in the soil survive fire and form long-lived seed banks ( Quintana-Ascencio et al 1998 ). Fire suppression and alteration of fire regimes consti-tute threats to this species because of its dependence on fire to release local populations from competitive exclusion (Quintana-Ascencio & Morales Hernández 1997;Quintana-Ascencio & Menges 2000).…”

“…We studied long-term seed-bank dynamics using H. cumulicola seeds in nylon mesh bags buried ( 5-10 cm depth) for 1 and 2 years in patches with different times since fire ( 20 seeds per bag, 2 ϫ 2 cm, Applied Extrusion Technologies, hole size 0.8 mm; five bags per year per site, two to three sites per treatment; Quintana-Ascencio et al 1998). We examined and counted the unearthed seeds under a microscope.…”

“…We examined and counted the unearthed seeds under a microscope. Damaged seeds were discarded and undamaged seeds were tested for germination in outdoor conditions for 4 months ( Quintana-Ascencio et al 1998).…”

Dominant species responses to drought in seasonal wetlands: evidence from reciprocal transplants across a moisture gradient1

“…In contrast, little is known about the reproductive ecology of rare Hypericum species with the notable exception of Hypericum cumulicola (Small) W.P. Adams (e.g., Quintana-Ascencio et al 1998Evans et al 2003, Trager et al 2005. Almost nothing is known about the ability of H. edisonianum to produce viable seed, the distribution and fate of its seed, or the extent and persistence of its clonal connections.…”