第17章寡头分析报告.ppt

* * This slide considers the effects of the attack ads on election outcomes and on social well-being. The negative impact on social well-being is like a negative externality: the “bystanders” are voters who are worse off as a result of the candidates’ actions. * * If you’re so inclined, this might be a good place to mention the infamous phone call in which Robert Crandall, CEO of American Airlines, tried to convince Braniff’s CEO Howard Putnam to raise fares 20%. If you can dig up a transcript of the conversation to read in class (try a simple Google search), students will find it interesting: it has lots of curse words. * * As I prepare this PowerPoint, I am shopping for a home theater sound system. My experience is relevant to this slide, and students have had similar experiences when shopping for stereo components, computers, or other products. I visited a local store to check out different brands and models. The salesperson at this store is very knowledgeable, and the store provided several comfortable, sound-proofed rooms where I could spend as much time as I wanted “auditioning” the various components without the intrusion of outside noise. Based on this shopping experience, I have selected a particular model made by Denon, a high-end brand that you really have to hear to appreciate. Now that I have decided on a brand and model, my incentive is to buy from a discount retailer. If I do, the discount retailer is, in effect, free-riding off of the full-service retailer I visited. If all consumers used the full-service retailers only for information, and then purchased from discount superstores, then full-service retailers would all go out of business. Denon knows this. They also know that consumers are less likely to choose their equipment over cheaper brands if consumers do not have the opportunity to hear how great Denon’s gear sounds. So, to prevent discount retailers from driving full-service retailers out of business, Denon engag