We study horizontal partial ownership arrangements in an oligopolistic industry in the absence of synergies. Contrary to existing results, we find that a dominant shareholder may choose to acquire shares in a competitor although the aggregate profit of the two firms is reduced. This is due to a...

This paper studies how moral feelings (hostility or altruism) modify incentive contractsin the Holmström and Milgrom (1990) multi-agent moral hazard model. One agentfeels altruism or hostility towards the other. His objective function is assumed to be aweighted sum of the two certain...