Frank M. Bass developed the Bass Diffusion Model to predict how innovative consumer durable products diffuse through consumer markets. This thesis will use data from 1999-2011 to examine the applicability of the Bass Diffusion Model to the introduction of alternative fuel vehicles (AFVs) in the automobile market. The findings in this thesis indicate the Bass Diffusion Model fit the diffusion pattern exhibited by AFVs well, but failed to accurately forecast diffusion patterns outside a given range of data. This thesis investigates potential reasons for the inaccurate 'Out of Sample Forecast', and gives recommendations for directions of future research on AFV diffusion.

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La Organización Industrial trata sobre la interacción estratégica entre empresas. ¿Cómo toman las decisiones las empresas cuando tienen en cuenta la reacción del resto de empresas? El objetivo es comprender mejor la decisión de las empresas y las consecuencias de éstas en la competencia del mercado. En el capítulo 2, investigo la interacción estratégica entre cooperación en investigación y desarrollo (I+D) y las fusiones posteriores. Se presenta un modelo teórico que relaciona redes estables de cooperación en I+D con decisiones de fusión, seguido por la competición en el mercado de productos. El resultado es que las fusiones y la cooperación en I+D son complementarias. Esto significa que hay fusiones que sólo existen porque las empresas construyen ciertas redes de cooperación en I+D. Si las cooperaciones no fueran permitidas, entonces las empresas elegirían no fusionarse. Otro resultado que obtengo es que hay cooperación entre empresas que no existirían si las empresas no se anticiparan a las posteriores fusiones. También encuentro que la cooperación con las empresas que no se fusionan son las relaciones claves, contradiciendo la intuición de que las empresas crean relaciones que se sustituirán por una fusión en un estado posterior. La consecuencia es que las empresas no fusionadas ganan poder de veto sobre la fusión y sólo permitirán ésta si la empresa resultante de la fusión no es demasiado competitiva. En el capítulo 3 presento un modelo para entender mejor cómo compiten las empresas de Capital de Riesgo con diferente acumulación de experiencia, y porque cooperan en los estadios iniciales de la financiación de riesgo. Considero que la decisión a cooperar la toman las empresas financiadoras, pero debe ser aprobado por el dueño del proyecto. Los resultados dicen que hay ganancias de bienestar resultantes de la cooperación porque las uniones de Capitalistas de Riesgo evalúan proyectos más efectivamente y proveen servicios con mayor valor añadido. Cuando se toma en cuenta al empresario, los Capitalistas de Riesgo no pueden apropiarse todas las ganancias derivadas del proyecto. El empresario se queda con parte del proyecto porque tiene la alternativa de no fusionarse. Así que presento un modelo de cooperación sin colusión. Otro resultado que encuentro es que los proyectos con mayor potencial son más probables de llevar a uniones, y que las mayores inversiones no llevan necesariamente a mayor cooperación. A través de un análisis empírico realizo un test para comprobar las conclusiones teóricas y obtengo que proyectos con tanto un mayor potencial como una mayor inversión tienen mayor probabilidad de resultar en una unión de capitalistas de riesgo. Finalmente, en el capítulo 4 se analizan las decisiones de las empresas sobre el momento de entrada de éstas en el mercado. Específicamente, analizo como estas decisiones se ven afectadas por las creencias de las empresas sobre la situación de la demanda y de la competencia. Otra contribución del artículo es estudiar si las empresas tienen incentivos para distorsionar las creencias y ser más optimistas sobre el estado de la demanda. Este capítulo considera un modelo de decisión sobre el momento de entrada endógeno con información incompleta sobre la demanda. Muestro que con empresas Bayesianas existe un único equilibrio Bayesiano perfecto donde las empresas con creencias optimistas producen en el primer periodo, mientras que las empresas con creencias pesimistas sólo producen en el segundo periodo. También encuentro que cuando las empresas pueden elegir ser demasiado confiadas, eligen no serlo. Sin embargo, les produce una ligera mejora tener la opción de elegirlo. / Industrial Organization concerns the strategic interaction between firms. How do firms take decisions when the reactions of others are taken into account? The goal is to better understand firms' decisions and their consequences in market competition. In chapter 2, I investigate the strategic interaction between research and development (R&D) cooperations and subsequent mergers. I present a theoretical model linking stable R&D cooperation networks with the decisions to merge, followed by the product market competition. I find that mergers and R&D cooperations are complements. This means that there are mergers that only exist because firms construct certain R&D cooperation networks. If cooperations were not allowed, then firms would choose not to merge. I also find that there are cooperations among firms that would not exist if the firms did not anticipate subsequent mergers. I also find that cooperations with non-merging parties are the key links, contradicting the intuition that firms create links to substitute for a merger at a later stage. The consequence is that the non-merging firm gains veto power over the merger and will only enable it if the resulting merged company is not too competitive. In chapter 3 I present a model that sheds light on how differently experienced Venture Capital firms compete and why they cooperate in the early stages of venture financing. I consider that the decision to cooperate is made by the financiers, but it must be approved by the owner of the project. I find that there are welfare gains from cooperating because syndications of Venture Capitalists evaluate projects more effectively and provide more value-added services. When the entrepreneur is taken into account, Venture Capitalists cannot appropriate all the gains from a venture. The entrepreneur retains part of the project by keeping the competition outside option. Therefore I present a model of cooperation without collusion. I also find that projects with greater potential are more likely to be syndicated and that larger investments do not necessarily lead to more cooperation. I test these two implications in an empirical analysis and find that projects with both a larger potential and a larger investment are more likely to be syndicated. Finally chapter 4 analyzes firms' decisions about the entry timing in markets. Specifically, I analyze how these decisions are affected by firms' beliefs about the state of the world. A second contribution of the paper is to study whether firms have incentives to distort beliefs and to become optimistic about the state of demand. The paper considers an endogenous timing model with incomplete information about demand. I show that with Bayesian firms there exists a unique perfect Bayesian equilibrium where firms with optimistic beliefs produce in the first period while firms with pessimistic beliefs only produce in the second period. I also find that when firms could choose to be overconfident they choose not to be. Nevertheless, they are weakly better by having the option to do so.

Zugl.: Vallendar, Wiss. Hochsch. für Unternehmensführung, Diss., 2007.

Title from PDF of title page (University of Missouri--Columbia, viewed on Feb 17, 2010). The entire thesis text is included in the research.pdf file; the official abstract appears in the short.pdf file; a non-technical public abstract appears in the public.pdf file. Dissertation advisor: Dr. Michael E. Sykuta. Vita. Includes bibliographical references.

This dissertation studies the effect of heterogeneity in consumer incomes on outcomes in vertically differentiated markets. When products are differentiated in quality, the consumer's choice of a particular product is a function of her income. Thus, the distribution of incomes plays an important role in shaping the demand for individual products in vertically differentiated markets. The first two chapters of the dissertation study the demand for passenger cars and trucks in the US. These vehicles are differentiated by quality that depends on vehicle's age. The first chapter studies the relationship between the distribution of consumer incomes and the distribution of vehicle vintages using a dynamic, heterogeneous agents model. The model predicts that higher per capita incomes are associated with younger vehicle stocks, if the vehicle ownership rates are high. If the per capita incomes are low, and so are the endogenous vehicle ownership rates, increases in income may lead to the aging of vehicles, by encouraging entry of lower income consumers into vehicle ownership via purchases of older vehicles. Higher levels of income inequality are associated with older vehicle stocks. The second chapter of the dissertation asks whether some of the observed increases in the average age of vehicles in the US can be attributed to the rise in real consumer incomes and the resulting changes in the composition of demand for different vehicle vintages. The dynamic, non-stationary, heterogeneous agents model, estimated on the aggregate vehicle ownership data for the US over the 1967-2001 period, provides a positive answer to this question. The third chapter of the dissertation studies the effect of inequality in consumer incomes on firms' entry, location, and pricing decisions in a static oligopoly model of vertically differentiated products. This paper computes the Nash equilibrium of a three-stage game similar to Shaked and Sutton (1982), to find that greater inequality in consumer incomes leads to the entry of more firms and results in more intense quality competition among the entrants. The consumption inequality is lower and the aggregate consumer welfare is higher in economies with greater income inequality. / text

The first chapter of this dissertation analyzes voting behavior across multiple elections. The voting literature has largely analyzed voter turnout and voter behavior separately, focusing on individual elections. I present a model of voter turnout and behavior in multiple elections. The assumptions are consistent with individual election preferences and decision is derived from utility maximization. Additionally, I provide necessary moment conditions for identification. The framework is applied to the 2008 California elections. The exit polls made national headlines by linking the historic turnout of African-Americans for Presidential candidate Obama in helping pass Proposition 8. The results show that the African-American turnout and voting share for Proposition 8 was lower than indicated by the exit polls. As a counterfactual, I look at the turnout and outcome of Proposition 8, without the presidential race on the ballot. As predicted, there is lower voter turnout: on par with midterm elections. I also find a lower share of Yes votes on Proposition 8 - enough that the referendum would not have passed. / Economics

This dissertation is a theoretical exploration of commonly used policy tools meant to improve market performance. The first chapter examines the use of prizes and grants as instruments for encouraging research and development. The second chapter investigates the welfare impact of price caps in oligopoly markets with endogenous entry. The third chapter studies the relationship between deposit insurance and bank risk taking, when a banker is motivated by reciprocity. The first chapter explores the use of grants and prizes as tools for encouraging research activity and innovation. Grants and prizes are commonly used by public and private research funders, and encourage R&D activity in different ways. Grants encourage innovation by subsidizing research inputs, while prizes reward research output. A common rationale for prizes is moral hazard; if a funder cannot observe all relevant research inputs then prizes create a strong incentive for R&D activity. In this chapter, it is shown that grants are a more efficient means of funding when a researcher's ability is unknown to the funder (adverse selection). When both adverse selection and moral hazard problems exist, a grant may emerge as an optimal funding mechanism, provided the moral hazard problem is relatively weak. In settings where the moral hazard problem is sufficiently strong, a grant emerges as part of an optimal funding mechanism, in conjunction with a prize. These results are useful for understanding different funding mechanisms used by both public and private entities. The second chapter, which is based on joint work with Stan Reynolds, examines the impact of price caps in oligopoly markets with endogenous entry. In the case of deterministic demand, reducing a price cap yields increased total output, consumer welfare, and total welfare. This result falls in line with classic results on price caps in monopoly markets, and with results for oligopoly markets with a fixed number of firms. These comparative static results for price caps need not hold when demand is stochastic and the number of firms is fixed, but recent results in the literature show that a welfare improving price cap does exist. We show that a welfare-improving cap need not exist in the case where demand is stochastic and entry is endogenous. In addition, we provide restrictions on the demand function such that a welfare-improving price cap exists under endogenous entry and stochastic demand. The third chapter, which is based on a joint project with Martin Dufwenberg, investigates the relationship between deposit insurance, risk taking, and insolvency. Empirical evidence suggests that the introduction of deposit insurance increases risk taking by banks and results in a greater chance of insolvency. The common rationale for this connection is that deposit insurance decreases the incentive for customers to monitor their banks, and invites excessive risk taking. In this chapter, it is argued that this classic explanation is somewhat puzzling. If customers can monitor their bank's behavior, certainly the insurance provider (FDIC) has this same ability. If this is the case, appropriate mechanisms could limit the moral hazard problem. We put forth an alternative explanation, and demonstrate that deposit insurance invites excessive risk taking when a banker is motivated by reciprocity.

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