Separation versus affiliation with partial vertical ownership in network industries

SERBERA, Jean-Philippe (2019). Separation versus affiliation with partial vertical ownership in network industries. International journal of the economics of business.

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The separation of integrated monopolies and new market entrants have changed vertical interactions between suppliers and dealers. Firms have substituted full integration with vertical restraints leading to collusive behaviour harmful to competition. We examine how a partial vertical ownership (an affiliation) of one of the competing downstream retailers by the upstream monopoly could help internalise the production decision after a complete divestiture. Our results in a Cournot framework confirm the positive role of partial integration on firms' profits and consumer surplus in increasing social welfare. These results are consistent with empirical studies of economies after vertical separation in network industries.

Item Type: Article
Uncontrolled Keywords: Economics; 1499 Other Economics; 1402 Applied Economics
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SWORD Depositor: Symplectic Elements
Depositing User: Symplectic Elements
Date Deposited: 29 Mar 2019 11:38
Last Modified: 17 Mar 2021 20:31

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