Stability analysis of horizontal mergers in a market with asymmetric substitutability

Kohei Takeda, Toyoki Hosoe, Takayuki Watanabe and Nobuo Matsubayashi

Mathematical Social Sciences, 2018, vol. 96, issue C, 73-84

Abstract: This study analyzes the stability of horizontal mergers in a Cournot oligopoly market. Although many researchers have addressed this issue, most previous studies assume symmetric firms in terms of demand and cost structures due to analytical tractability. We attempt to find a stable merger in a general n-firm oligopoly in which we allow for asymmetric substitutability between firms. To ensure analytical tractability, we follow the related literature and employ a simple core allocation for a monopoly merger as a stability concept.

Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:eee:matsoc:v:96:y:2018:i:c:p:73-84

DOI: 10.1016/j.mathsocsci.2018.09.004

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