The effect of Common Ownership and Input-Output networks: the case of the Spanish Economy

Matteo Bizzarri () and Fernando Vega-Redondo ()
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Matteo Bizzarri: Università di Napoli Federico II, Napoli, Italy
Fernando Vega-Redondo: The Chinese University of Hong Kong, Hong Kong

No 25-05, Working Papers from NET Institute

Abstract: We quantify a parsimonious model of oligopolistic competition with common ownership in input–output networks. Using Spanish data on demand, ownership, and input–output linkages, we estimate the overall welfare effect of common ownership. Input–output linkages introduce a theoretical channel through which common ownership could improve welfare. We find that this channel exists but is not strong enough to offset the reduction in competition: common ownership has a negative welfare effect, though weaker than in the absence of input–output linkages. Finally, we introduce a parameterized ownership separation to compute a firm-level index of the anti-competitiveness of common ownership.

Keywords: production networks; network games; common ownership; oligopoly (search for similar items in EconPapers)
JEL-codes: D43 D57 D85 L13 L16 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2025-09
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