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- ISIDORE Id: 10670/1.52218d...
- hal: hal-02936733
- doi: 10.1016/j.ijindorg.2020.102643
- PII: S0167-7187(20)30066-7
- WOS: 000573442600002
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info:eu-repo/semantics/altIdentifier/doi/10.1016/j.ijindorg.2020.102643
http://creativecommons.org/licenses/by-nc/ , info:eu-repo/semantics/OpenAccess
Mots-clés
Merger Vertically related markets Competition with capacity constraints L - Industrial Organization/L.L1 - Market Structure, Firm Strategy, and Market Performance D - Microeconomics/D.D4 - Market Structure, Pricing, and Design D - Microeconomics/D.D8 - Information, Knowledge, and Uncertainty -fin]Sujets proches
Public markets Businesses Firms Companies Enterprises Business organizations Organizations, BusinessCiter ce document
David Martimort et al., « Downstream mergers in vertically related markets with capacity constraints », HAL SHS (Sciences de l’Homme et de la Société), ID : 10.1016/j.ijindorg.2020.102643
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Résumé
Motivated by a recent merger proposal in the French outdoor advertising market, we develop a model in which firms are initially endowed with some advertising capacities and compete on two fronts. First, firms compete to acquire additional advertising capacities on an upstream market; a first stage modeled as a second-price auction with externalities. Second, those firms, privately informed on their own costs, use their capacities on the downstream market to supply advertisers whose demand is random; a second stage modeled by means of mechanism design techniques. We study the linkages between the equilibrium outcomes on both markets. When a firm is endowed with more initial capacity, through the acquisition of a competitor for instance, whether it becomes more or less eager to acquire extra capacity on the upstream market depends a priori on fine details of the downstream market. Under reasonable choices of functional forms, we demonstrate that a downstream merger does not create any bias in the upstream market towards the already dominant firm. (C) 2020 Elsevier B.V. All rights reserved.
