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"Buy it or make it Yourself ?" A Paradox

Author

Listed:
  • GABSZEWICZ, Jean J.

    (CORE, Université catholique de Louvain, B-1348 Louvain-la-Neuve, Belgium)

  • GARELLA, Paolo G.

    (Dipartimento di Scienze Economiche, Universita di Bologna)

Abstract

In the present note we study how the strategic considerations in a duopoly affect the choice by the two firms whether or not to internalize production of an intermediate input. The failure to minimize costs is shown to be a possible outcome of a two-stage game representing the firms' decision process.

Suggested Citation

  • GABSZEWICZ, Jean J. & GARELLA, Paolo G., 1995. ""Buy it or make it Yourself ?" A Paradox," LIDAM Discussion Papers CORE 1995014, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:1995014
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    File URL: https://sites.uclouvain.be/core/publications/coredp/coredp1995.html
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    Cited by:

    1. SANIN, Maria Eugenia & ZANAJ, Skerdilajda, 2007. "Environmental innovation under Cournot competition," LIDAM Discussion Papers CORE 2007050, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Emanuele Bacchiega & Paolo Garella, 2006. "Disclosing vs. Withholding Technology Knowledge in a Duopoly," Working Papers 0609, University of Crete, Department of Economics.
    3. Emanuele Bacchiega & Paolo G. Garella, 2008. "Disclosing Versus Withholding Technology Knowledge In A Duopoly," Manchester School, University of Manchester, vol. 76(1), pages 88-103, January.

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