This dissertation aims to contribute to the research on non-integrated vertical structure and the durable-goods literature. It consists of four chapters.

The first chapter is an introductory chapter. It gives an overview of the issues and summarizes the findings in the subsequent chapters.

The second chapter, “The Variation of Retail Pass-Through with Store-Brand Entry and Its Determinants – Evidence from Scanner Data” is a first study in the literature which investigates empirically the effects of store brand entry on retail pass-through. We show that the entry of store brand is generally accompanied by reductions in pass-through and that there are substantial variations in the reductions. Then we find that these variations in pass-through changes are related to brand-specific and manufacturer-specific characteristics.

The third and fourth chapters both discuss the durable-goods market. The third chapter, “Durable-Goods Monopoly and the R&D Decision in the Spatial Model”, investigates the R&D decision of a multi-product, durable-goods monopoly with heterogeneous consumers and a secondhand market. We corroborate some conventional results including those involving the time-inconsistency and over-investment problems in a more general and realistic setting. On the other hand, we additionally show that the incentive to invest is too low for a monopolist under the rental regime, and if the heterogeneity of consumers is small enough, a monopoly can do better under a selling regime.

The fourth chapter, “Innovation Decision in the Durable-Goods Market with Spatial Competition”, investigates the innovation decision of oligopolistic firms in a horizontally differentiated durable-goods market. We find that firms face time-inconsistency in their innovation decisions, but the nature of the problem is different from the standard Coasian dynamics. We also show that the effectiveness of commitment to solve the time-inconsistency problem diminishes with competition. We finally explore the efficiency aspect of innovation and compare the incentives with the monopoly.