Regulation, vertical integration and sabotage

被引:62
作者
Beard, TR
Kaserman, DL
Mayo, JW
机构
[1] Auburn Univ, Dept Econ, Auburn, AL 36849 USA
[2] Georgetown Univ, Sch Business, Washington, DC 20057 USA
关键词
D O I
10.1111/1467-6451.00152
中图分类号
F8 [财政、金融];
学科分类号
0202 ;
摘要
We consider the incentive of a dominant firm that supplies a necessary input to a Bertrand-competitive differentiated products downstream industry to: (1) vertically integrate forward, and (2) raise its downstream rivals' costs through non-price activities which we characterize generally as 'sabotage'. We examine these incentives both in the absence and presence of a regulatory constraint on the upstream price. We find that, while an incentive for vertical integration is present regardless of the existence of the regulatory constraint, the incentive for sabotage emerges only in the presence of binding input price regulation. Welfare effects are also explored.
引用
收藏
页码:319 / 333
页数:15
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