Firms’ strategic delegation with heterogeneous consumers

Pan, Cong; Lee, DongJoon; Choi, Kangsik

doi:10.1007/s00712-020-00707-7

Cited by 6 publications

(5 citation statements)

References 27 publications

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“…We explain the plausibility of the timing structure in section 3. 10 Several papers also show asymmetric managerial structures in different contexts(Vroom 2006;Mujumdar and Pal 2007;Löffler 2008, 2012;Pan et al 2020). We explain the difference between those papers and ours in section 2.…”

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confidence: 72%

“…Recent work by Pan et al (2020) also shows the possibility that an asymmetric managerial structure emerges in a duopoly with quantity competition. The key factor in their paper is equilibrium multiplicity under the convex inverse demand function proposed by Ishibashi and Matsushima (2009).…”

Section: Related Papersmentioning

confidence: 99%

“…Some theoretical studies have investigated how strategic organizational design affects firm asymmetry (Vroom 2006; Mujumdar and Pal 2007; Kopel and Löffler 2008, 2012; Pan et al 2020). The stream of this research interprets the organizational design as a commitment device for firms' output decisions.…”

Section: Related Papersmentioning

confidence: 99%

“…Even if they would also assume that a delegating firm incurs costs of delegation, as in Basu (1995) and our paper, an asymmetric managerial structure does not appear. 13 Some theoretical studies have investigated how strategic organizational design affects firm asymmetry (Vroom 2006;Mujumdar and Pal 2007;Löffler 2008, 2012;Pan et al 2020). 14 The stream of this research interprets the organizational design as a commitment device for firms' output decisions.…”

Section: Related Papersmentioning

confidence: 99%

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The impacts of suppliers and mutual outsourcing on organizational forms

Matsushima

Arai

2023

Canadian J of Economics

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We consider a downstream duopoly model with a monopolistic common supplier and mutual outsourcing between the two symmetric downstream firms. The market structure captures the recent procurement environment in the smartphone industry. We also incorporate managerial delegations into the duopoly model because deciding on organizational forms within a firm is critical to achieving better performance in almost all industries. There is an equilibrium in which only one of the firms delegates its downstream production to its sales manager. A delegating firm becomes less aggressive. The profits when both firms delegate can be higher than those when no firm delegates. The total surplus when both firms delegate is smaller than that when no firm delegates.

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confidence: 72%

Section: Related Papersmentioning

confidence: 99%

Section: Related Papersmentioning

confidence: 99%

Section: Related Papersmentioning

confidence: 99%

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The impacts of suppliers and mutual outsourcing on organizational forms

Matsushima

Arai

2023

Canadian J of Economics

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“…7 7 Several other papers enrich the market structure as per Ishibashi and Matsushima (2009) by considering a price competition with vertical differentiation of products (Amaldoss and Shin, 2011), the competition between private and public sectors (Ishibashi and Matsushima, 2012), firms' endogenous timing problem (Pan, 2018), or firms' strategic delegation (Pan et al ., 2020). These papers consider a simultaneous oligopoly setting without considering the impact of entrants.…”

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confidence: 99%

Competition between branded and nonbranded firms and its impact on welfare

Pan

2020

Southern Economic Journal

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We examine a quantity competition among branded and nonbranded firms. The market comprises two consumer segments: one purchases only branded products (the high-end market), while the other segment's consumers purchase less expensive products (the low-end market). When branded firms take actions sequentially, we show that the branded leader has an incentive to restrict its quantity to avoid entering the low-end market. As the follower recognizes this incentive, it can restrict the leader by implementing a quantity constraint, which is affected by the number of nonbranded firms. We find that both the branded leader and follower could benefit from the nonbranded firms and that the leader prefers to have more nonbranded firms in the market than the follower does. Furthermore, we show that the free entry of nonbranded firms could negatively affect total surplus as well as consumer surplus even without any costs, because of the premium pricing of branded products.

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Delegation in multiproduct downstream firms with heterogeneous channels

Choi

2021

J Econ

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Firms’ strategic delegation with heterogeneous consumers

Cited by 6 publications

References 27 publications

The impacts of suppliers and mutual outsourcing on organizational forms

The impacts of suppliers and mutual outsourcing on organizational forms

Competition between branded and nonbranded firms and its impact on welfare

Delegation in multiproduct downstream firms with heterogeneous channels

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