Monopolies Lose Pricing Power, Consumers Win Big in Vertically Linked Markets
The article investigates how competing companies decide when to introduce products in a mixed market where both public and private companies coexist. It shows that in this setting, the type of competition—like setting prices or quantities—can determine which company takes the lead. The study also discovered that in a certain type of competition, the profits and benefits to consumers between different pricing strategies switch places. Lastly, the research suggests it could be better for society if some input pricing strategies are prohibited or allowed, depending on the competition style.