Strategic behavior downstream and the incentive to integrate: a spatial model with delivered pricing
Article Abstract:
Previous research has failed to tackle some of the private and social incentives for the use of vertical integration in spatial models. In the case of higher transport expenses in a downstream monopoly that serves customers on a unit line and buys an input from an upstream monopoly, the upstream firm is forced to lower its input price rather than experience a decrease in sales. This lowers overall welfare and profit since downstream profit is increased by the lower input price, leading to private and social incentives for vertical integration.
Publication Name: International Journal of Industrial Organization
Subject: Business, international
ISSN: 0167-7187
Year: 1995
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A note on N. Economides: the incentive for non-price discrimination by an input monopolist
Article Abstract:
The claim that a vertically integrated input monopolist always has the incentive to increase the cost of the rivals to its subsidiary in a discriminatory way is discussed. It is argued that there are no incentives for raising rivals' costs.
Publication Name: International Journal of Industrial Organization
Subject: Business, international
ISSN: 0167-7187
Year: 2000
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Comment on "A note on N. Economides: the incentive for non-price discrimination by an input monopolist," by Mats Bergman
Article Abstract:
Issues concerning the incentive for non-price discrimination of a monopolist in an input market who also sells in an oligopoly downstream market via a subsidiary are discussed.
Publication Name: International Journal of Industrial Organization
Subject: Business, international
ISSN: 0167-7187
Year: 2000
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