Leasing versus Selling and Firm Efficiency in Oligopoly

Kamal Saggi () and Nikolaos Vettas ()

No 99-07, Working Papers from Duke University, Department of Economics

Abstract: We examine sales and leasing of a durable good in an asymmetric duopoly. We find that inefficient firms tend to lease more. While the low cost firm sells more than the high cost firm, the high cost firm leases more. Further, an increase in unit costs implies a higher ratio of leased units to sales. This pattern is reversed when the unit cost decreases significantly over time.

JEL-codes: D43 L13 (search for similar items in EconPapers)
Date: 1999
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Published in ECONOMICS LETTERS, Vol. 66, 2000, pages 361-368

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Journal Article: Leasing versus selling and firm efficiency in oligopoly (2000)
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