In this paper we analyze how the technology used by downstream firms can influence inputand output market prices. We show via an example that both these prices increase under adecreasing returns technology while the contrary holds when the technology is constant....

In the theoretical literature, strong arguments have been provided in support of the efficiencydefense in antitrust merger policy. One of the most often cited results is due to Williamson(1968) that shows how relatively small reduction in cost could offset the deadweight loss of alarge price...

The aim of this paper is to test the predictions of Sutton's model of independentsubmarkets for the Italian retail banking industry. This industry, in fact, can be viewedas made of a large number of local markets corresponding to different geographicallocations. In order to do that, I first...

This paper examines a three-stage model of divisionalization where, first, two parentfirms create independent units, second, the parent firms allocate cost reduction levelsover these units, and third, the resulting units compete in a Cournot market given theircurrent costs of production. The...

We analyse a (differentiated good) industry where an incumbent firm owns a networkgood (essential input) and faces potential competition in the (downstream) retailmarket. Unlike the traditional approach, we consider a scenario where the decision tocompete or not in the downstream segment is...