The first essay extends the theory of clubs by stating new conditions, spatially-limited altruism, under which mixed clubs are optimal. With such altruism, the nonpoor members of society care more about the poor living near them than about those living farther away. While the proximity of the poor gives mixed communities an altruistic advantage over homogeneous communities, the intermixing of rich and poor generates an efficiency loss in public consumption. As a result, a mixed community configuration may or may not be superior to a homogeneous configuration. The second essay addresses the potential optimality of multiproduct clubs when the joint cost function of such clubs exhibits economies of scope. On the one hand, the joint provision of public goods in multiproduct clubs leads to cost savings under economies of scope. However, there is an efficiency loss from such clubs, since consumption group sizes cannot be set individually for each good. The analysis formalizes these costs and benefits and deriving conditions under which multiproduct clubs are desirable. The third essay analyses the effect of public provision of a loss-preventive good on competitive equilibrium of an insurance market under moral hazard. The primary advantage of public provision lies in its ability to produce information, which eliminates moral hazard. On the other hand, it leads to a different cost of providing the good because of scale (dis)economies in public consumption and production as well as consumption inefficiency with nonidentical individuals. The analysis formalizes this benefit and cost involved in public provision.

This dissertation comprises of three essays in industrial economics. My first essay analyzes social efficiency of entry into a downstream oligopoly of a vertical market structure, where an upstream supplier sells an essential input to all firms producing downstream. In the downstream markets, a multiproduct firm is both a monopoly in its own product and a leader in a different product market with free entry of followers. We show that in the presence of scale economies, entry is socially insufficient. The insufficiency of entry is due to the fact that entry generates a business-creating effect significantly large enough to dominate a business-stealing effect, regardless of whether the upstream supplier's input pricing strategy is discriminatory or uniform. This suggests that entry regulation as a public policy is socially undesirable in the downstream oligopoly of a vertical market structure. My second essay examines differences in welfare implications between discriminatory and uniform input price regimes in vertically related markets where a multiproduct firm operates downstream in two separate markets: one is a monopoly and the other is an oligopoly with entry of new firms. In the analysis, we analyze how the downstream entry into the oligopolistic market affects social efficiency. In an open economy, whether the input price regime is discriminatory or uniform, entry is always socially excessive in the presence of scale economies. This contrasts with the existing studies in the literature that entry is always socially insufficient in an open economy with the presence of scale economies. Focusing on the scenario where vertically integrated producer (VIP) adopts a non-foreclosure strategy, my third essay shows that downstream entry is socially insufficient despite scale economies and the marginal cost difference between the VIP and its retail competitors. The non-foreclosure equilibrium arises when the VIP's wholesale profit from the sales of an essential input is sufficiently large and the VIP shares the profit with its downstream competitors. For the case of an open economy where the VIP is a foreign firm, downstream entry continues to be socially insufficient. Entry regulation is therefore socially undesirable, but a production subsidy encouraging downstream entry is shown to be a welfare-improving policy.