Downstream cross-holdings and divestment incentives under bilateral bargaining

Arijit Mukherjee and Chenhang Zeng

Economics Letters, 2024, vol. 242, issue C

Abstract: We study the stability of downstream cross-holdings in a bilateral duopoly with firm-specific bargaining. We show that the downstream firms never (partially, completely) divest shares if the upstream firms have significant (medium, low) bargaining power.

Keywords: Bilateral duopoly; Bargaining power; Cross-holdings; Divestment incentive (search for similar items in EconPapers)
JEL-codes: L13 L41 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:242:y:2024:i:c:s0165176524003793

DOI: 10.1016/j.econlet.2024.111895

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