Electronic Resource
Oxford, UK
:
Blackwell Publishing Ltd.
Journal of economics & management strategy
9 (2000), S. 0
ISSN:
1530-9134
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
We consider a model where oligopolistic firms create independent divisions or franchises, which subsequently delegate output decisions to managers. We show that the number of firms required to make divisionalization privately profitable is greater in our model than in previous pure divisionalization models. However, in contrast with pure delegation models, we show that the subgame perfect Nash equilibrium approaches perfect competition as divisionalization costs tends to zero, even with a small fixed number of firms.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/j.1430-9134.2000.00321.x
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