The entry incentives of complementary producers: A simple model with implications for antitrust policy

Juan S. Lleras and Nathan H. Miller

Economics Letters, 2011, vol. 110, issue 2, 147-150

Abstract: We model competition between two firms in an upstream-downstream relationship. Each firm can pay a sunk cost to enter the other's market. We show that coordination (e.g., through merger) can be anticompetitive, and that such coordination can arise in equilibrium.

Keywords: Vertical; mergers; Entry; incentives; Complementary; products (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:110:y:2011:i:2:p:147-150

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