"Buy it or make it Yourself ?" A Paradox

Jean Gabszewicz and Paolo Garella

No 1995014, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: In the present note we study how the strategic considerations in a duopoly affect the choice by the two firms whether or not to internalize production of an intermediate input. The failure to minimize costs is shown to be a possible outcome of a two-stage game representing the firms' decision process.

Date: 1995-02-01
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