Profit-reducing fixed-price contract: The role of the transport sector

Kazuhiro Takauchi

MPRA Paper from University Library of Munich, Germany

Abstract: We show that under a fixed-price contract where an upstream firm first sets the input price and downstream firms subsequently invest in R&D, all firms can become worse off when considering two-way trade with firm-specific carriers.

Keywords: Fixed-price contract; Firm-specific carriers; R&D; Two-way trade (search for similar items in EconPapers)
JEL-codes: F12 L13 O31 R40 (search for similar items in EconPapers)
Date: 2016-05-18
New Economics Papers: this item is included in nep-bec, nep-com, nep-cta and nep-ino
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:71413

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