Common ownership and information exchange in a duopoly

Jos Jansen

Economics Letters, 2024, vol. 243, issue C

Abstract: I analyze effects of common ownership or cross-ownership on the incentives of Cournot competitors with close substitutes to exchange perfectly correlated information. Consistent with empirical findings, firms have stronger incentives to exchange information for greater degrees of common ownership. There is a trade-off for consumers. On the one hand, more common ownership relaxes competition, which hurts consumers. On the other hand, more common ownership may yield more information exchange, which benefits consumers. Consequently, positive degrees of common ownership may maximize the expected consumer (and total) surplus.

Keywords: Common ownership; Cross-ownership; Duopoly; Information exchange; Common value; Consumer surplus (search for similar items in EconPapers)
JEL-codes: D21 D43 D83 G32 L13 L22 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176524004154
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:243:y:2024:i:c:s0165176524004154

DOI: 10.1016/j.econlet.2024.111931

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().