Incomplete contracting and price regulation

• 成果类型: Article
• 署名作者: Bös, D
• 署名单位: University of Bonn
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(99)00014-6
• 发表日期: 1999
• 页码: 353-371
• 关键词: Regulation; incomplete contracts; hold-up problem

摘要

This paper deals with price regulation of a monopolistic distribution grid which sells a license to some retailer. The regulator aims at attaining efficient sale of the license and efficient relationship-specific investments of the agents. The first best can be attained by a sequential regulatory mechanism which gives the seller an option to grant the license but allows the buyer to make counteroffers. This sequential mechanism runs counter to the usual price-cap idea since possible upward but never downward renegotiation of the regulated prices is the vehicle to attain the first best. (C) 1999 Elsevier Science S.A. All rights reserved.