January 12, 2009

Russia and Ukraine Natural Gas Disputes Illustrate the Bilateral Monopoly Problem

Michael Giberson At the Streetwise Professor, Craig Pirrong writes that the periodic interruptions in natural gas flows from Russia across Ukraine present a “classic bilateral monopoly situation.” Bottom line–there are no saints involved in this episode.  There is a classic bilateral monopoly situation.  Each side is using its leverage to try to extract as much …

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Low Entry Barriers in Electric Car Market

Lynne Kiesling Very interesting story in today’s Wall Street Journal about BYD, a Chinese firm manufacturing electric vehicles. One of the most interesting points in this article: despite the global economic downturn, BYD is increasing its operations, first in China and then planned for US and Europe, because entry barriers are lower in the electric …

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