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https://doi.org/10.1016/s1573-448x(89)01010-1

has been cited by the following article:

• TITLE: Firms’ Coalitions, Demand Systems and Asymmetric Prices

  AUTHORS: Armando Jose Garcia Pires, Frode Skjeret

  KEYWORDS: Firms’ Coalitions, Partial Cartels, Mergers and Acquisitions, Joint Ventures, Demand Systems, Asymmetric Prices

  JOURNAL NAME: Theoretical Economics Letters, Vol.15 No.3, June 25, 2025

  ABSTRACT: We extend Deneckere and Davidson’s model on firms’ incentives to form coalitions to predict which firms are more likely to enter a coalition. In Deneckere and Davidson, all firms have the same incentives to enter a coalition because they are all symmetric and therefore choose symmetric prices. We modify their demand specification to include different cross-price elasticities. With this, we can generate market equilibria where firms have different prices, and therefore different incentives to enter a coalition. Our modified model can inform the construction and estimation of empirical models of coalitions and price formation.