Competing buyers, rent extraction and inefficient exclusion

Simen Ulsaker

International Journal of Industrial Organization, 2020, vol. 68, issue C

Abstract: The article illustrates how a seller profitably can prevent entry of a potential competitor, even when entry would increase industry profit. Entry is prevented by offering exclusive contracts to the buyers. The buyers are assumed to be differentiated firms, competing in a downstream market. Exclusion occurs in equilibrium as long as there is some degree of competition among the downstream firms, and even when there are no economies of scale in upstream production.

Keywords: Vertical relations; Exclusive contracts; Naked exclusion; Vertical restraints. (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:68:y:2020:i:c:s0167718719300840

DOI: 10.1016/j.ijindorg.2019.102556

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