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Inventories in a Labour-Managed Economy

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  • Kazuhiro Ohnishi

    (Osaka University and Institute for Basic Economic Science, Osaka, Japan)

Abstract

This paper considers a two-period model in which two labour-managed firms can use inventory investment as a strategic device. In the first period, each firm simultaneously and independently chooses how much it sells in the current market and the level of inventory it holds for the second-period market. The paper shows the reaction curves in the model with inventories. The paper finds that inventories may be used by labour-managed firms to facilitate tacit collusion.

Suggested Citation

  • Kazuhiro Ohnishi, 2010. "Inventories in a Labour-Managed Economy," Zagreb International Review of Economics and Business, Faculty of Economics and Business, University of Zagreb, vol. 13(1), pages 41-50, May.
    • Handle: RePEc:zag:zirebs:v:12:y:2010:i:1:p:41-50
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