We analyze health care option demand markets with vertical restraints divided along two dimensions: naked and conditional exclusion, and vertical integration; applicable to the upstream, the downstream, and both markets. Our unified framework includes forward and backward integration, and joint...

This article examines a model of competition between two types of health insurer: Health Maintenance Organizations (HMOs) and nonintegrated insurers. HMOs vertically integrate health care providers and pay them at a competitive price, while nonintegrated health insurers work as indemnity plans...

This paper (only available in Spanish) summarises the relevant literature in the field of vertical restraints in connection with retail markets and distribution, and provides some insights from Chilean practice

Conventional wisdom presumes that a supplier in a monopolistic market, or in an oligopolistic market that is not perfectly competitive, has the power to charge a supra-competitive wholesale price. In contrast, elaborating on recent economics studies, this Article shows that the supplier of an...

Conventional wisdom presumes that a supplier in a monopolistic market, or in an oligopolistic market that is not perfectly competitive, has the power to charge a supra-competitive wholesale price. In contrast, elaborating on recent economics studies, this Article shows that the supplier of an...

The welfare effects of vertical integration are ambiguous. Cost efficiencies and the elimination of double marginalization may offset increases in market power and incentives to raise rivals' costs. To study the effects of vertical integration between insurers and hospitals, we develop a model...

In a paper in the March 2004 AER, Justine Hastings concludes that the acquisition of an independent gasoline retailer, Thrifty, by a vertically integrated firm, ARCO, is associated with sizable price increases at competing stations. To better understand the novel mechanism to which she...

A vertical merger model represents a complex system built on (i) a network of e.g., upstream manufacturers and downstream retailers (ii) who bargain bilaterally in the presence of externalities (iii) created by competition between downstream retailers (iv) facing a consumer demand surface. We...

We show how an upstream firm by using a price-dependent profit-sharing rule can prevent destructive competition between downstream firms that produce relatively close substitutes. With this rule the upstream firm induces the retailers to behave as if demand has become less price elastic. As a...