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We provide a simple model to investigate decisions about vertical separation. The key feature of this model is that more than one input is required for the final product of the downstream monopolist. We show that as the bargaining powers of independent complementary input suppliers grow larger,...
Persistent link: https://www.econbiz.de/10003921809
This paper analyzes vertical integration incentives in a bilaterally duopolistic industry where upstream producers bargain with downstream retailers on terms of supply. In the applied framework integration does not affect the total output produced, but it affects the distribution of rents among...
Persistent link: https://www.econbiz.de/10009558227
We study the timing of new technology adoption in markets with input outsourcing, and thus with vertical relations. We find that technology adoption can take place earlier when firms engage in input outsourcing than when they produce the input in-house. Hence, the presence of vertical relations...
Persistent link: https://www.econbiz.de/10011346708
In some cases spot markets failure to govern to whole or a part of the marketing channel effectively and contractual relations are gaining more importance. It is especially true in case of agricultural markets, since these markets became more differentiated and market players are vulnerable in...
Persistent link: https://www.econbiz.de/10011560822
supplier an increase of R&D intensity in 2010 by a percentage point would reduce profits by about 14 % in 2012 given the …
Persistent link: https://www.econbiz.de/10010425660
all firms compete in prices. With an acquisition, downstream firms internalize the effects of their actions on their … backwards ownership leads to increasing downstream prices and is more profitable, as long as competition is sufficiently … prices. All results are sustained when upstream suppliers are allowed to charge two part tariffs. -- Double marginalization …
Persistent link: https://www.econbiz.de/10009512802
We study the implications of different contractual forms in a market with an incumbent upstream monopolist and free downstream entry. We show that traditional conclusions regarding the desirability of linear contracts radically change when entry in the downstream market is endogenous rather than...
Persistent link: https://www.econbiz.de/10012824081
competition between sellers lowers product prices, increases the surplus consumers receive from a sub-market, and makes platform … membership more desirable for consumers. However, more competition also lowers profits for a seller which makes platform …
Persistent link: https://www.econbiz.de/10013004938
supplier an increase of R&D intensity in 2010 by a percentage point would reduce profits by about 14% in 2012 given the …
Persistent link: https://www.econbiz.de/10013044250
This paper analyzes vertical integration incentives in a bilaterally duopolistic industry where input market outcomes are determined by bargaining. Vertical integration incentives are a combination of horizontal integration incentives up- and downstream and depend on the strength of...
Persistent link: https://www.econbiz.de/10013258145