One of the most enduring controversies in antitrust concerns the potential foreclosure effects of vertical integration. In a recent paper, Ordover, Saloner and Salop (1990) construct a model of vertical integration in which vertical foreclosure emerges as the equilibrium outcome. However, as is...

This paper develops an equilibrium model of vertical foreclosure with the choice of input specifications. In this model, vertical foreclosure occurs as the upstream division of the integrated firm makes a specialized input for its sister downstream division while it would, as an independent...