Bargaining, Mergers, and Technology Choice in Bilaterally Oligopolistic Industries  

Oleh:

Inderst, Roman ; Wey, Christian

Jenis: Article from Bulletin/Magazine
Dalam koleksi: The Rand Journal of Economics vol. 34 no. 1 (2003), page 1-19.
Topik: oligopoly; bargaining; mergers; technology choice; bilaterally oligopolistic

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: RR10 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

We analyze up - and downstream market structure and the choice of technology in a bilaterally oligopolistic industry. The distribution of industry profits between up- and downstream firms is determined by a procedure of bilateral negotiations, which is shown to generate the Shapley value. Incentives for downstream mergers depend on whether upstream firms have increasing or decreasing unit costs, while incentives for upstream mergers depend on whether products are substitutes or complements. Incentives for upstream firms to reduce marginal costs increase with a downstream merger and decrease with an upstream merger. Finally, downstream firms may strategically choose a particular market structure to affect upstream technology choice.

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