On the superiority of fixed fee over auction in asymmetric markets

Giorgos Stamatopoulos and Tami Tauman

Games and Economic Behavior, 2009, vol. 67, issue 1, pages 331-333

Abstract: It is well known that selling licenses for the use of a cost-reducing innovation by auction yields a higher revenue compared to fixed fee in a symmetric Cournot industry. In this note we show that this result can be reversed in an asymmetric Cournot industry, i.e., the fixed fee policy can generate a strictly higher revenue than the auction policy in an industry where prior to the innovation firms are cost-asymmetric.

Keywords: Cost-reducing; innovation; Asymmetric; firms; Fixed; fee; Auction (search for similar items in EconPapers)
Date: 2009

Downloads: (external link)
http://www.sciencedirect.com/science/article/B6WFW ... d1ee2f7b83bc776d36ff
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eee:gamebe:v:67:y:2009:i:1:p:331-333

Access Statistics for this article

Games and Economic Behavior is edited by E. Kalai

More articles in Games and Economic Behavior from Elsevier
Series data maintained by Heidi Boesdal ().