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Contribution Details
| Type | Journal Article |
| Scope | Discipline-based scholarship |
| Title | Asymmetric vertical integration |
| Organization Unit | |
| Authors |
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| Item Subtype | Original Work |
| Refereed | Yes |
| Status | Published in final form |
| Language |
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| Journal Title | Advances in Theoretical Economics |
| Publisher | Berkeley Electronic Press |
| Geographical Reach | international |
| ISSN | 1534-5963 |
| Volume | 5 |
| Number | 1 |
| Page Range | n/a |
| Date | 2005 |
| Abstract Text | We examine vertical backward integration in a reduced-form model of successive oligopolies. Our key findings are: (i) There may be asymmetric equilibria where some firms integrate and others remain separated, even if firms are symmetric initially; (ii) Efficient firms are more likely to integrate vertically. As a result, integrated firms also tend to have a large market share. The driving force behind these findings are demand/mark-up complementarities in the product market. We also identify countervailing forces resulting from strong vertical foreclosure, upstream sales and endogenous acquisition costs. |
| Free access at | DOI |
| Related URLs | |
| Digital Object Identifier | 10.2202/1534-5963.1164 |
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