Endogenous and exogenous commitment

Zachary Breig

Economics Letters, 2019, vol. 183, issue C, -

Abstract: I study a dynamic model of monopoly sales in which one long-term monopolist without exogenous commitment power interacts with a sequence of short-term consumers with private valuations. I provide a folk theorem which characterizes the payoffs of a sufficiently patient monopolist and I show that exogenous commitment power can obstruct the endogenous commitment from repeated game incentives.

Keywords: Commitment; Mechanism design; Repeated games; Spot contracting; Renegotiation (search for similar items in EconPapers)
JEL-codes: C73 D42 D82 D86 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:183:y:2019:i:c:20

DOI: 10.1016/j.econlet.2019.108577

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