Nocke, Volker and Rey, Patrick (2014) Exclusive Dealing and Vertical Integration in Interlocking Relationships. TSE Working Paper, n. 14-515, Toulouse

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Abstract

We develop a model of interlocking bilateral relationships between upstream manufacturers that produce differentiated goods and downstream retailers that compete imperfectly for consumers. Contract offers and acceptance decisions are private information to the contracting parties. We show that both exclusive dealing and vertical integration between a manufacturer and a retailer lead to vertical foreclosure, at the detriment of consumers and society. Finally, we show that firms have indeed an incentive to sign such contracts or to integrate vertically.

Item Type: Monograph (Working Paper)
Language: English
Date: July 2014
Place of Publication: Toulouse
Uncontrolled Keywords: Vertical relations, exclusive dealing, vertical merger, foreclosure, bilateral contracting
JEL Classification: D43 - Oligopoly and Other Forms of Market Imperfection
L13 - Oligopoly and Other Imperfect Markets
L42 - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 16 Mar 2015 14:49
Last Modified: 02 Apr 2021 15:49
OAI Identifier: oai:tse-fr.eu:28372
URI: https://publications.ut-capitole.fr/id/eprint/16548

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