Endogenous Formation of Joint Ventures with Efficiency Gains

Sang-Seung Yi

RAND Journal of Economics, 1998, vol. 29, issue 3, 610-631

Abstract: I study stable structures of efficiency-enhancing joint ventures among symmetric firms. Efficiency gains that accrue to a joint venture are assumed to increase with its size. The socially efficient industrywide joint venture is the stable outcome when membership of a joint venture is open to outside firms, but typically not when membership can be restricted. Members of a large joint venture want to restrict membership for strategic reasons -- e.g., in order to keep rival firms' costs high. Side payments among firms do not eliminate the strategic incentives of members of a large joint venture to limit membership

Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (37)

Downloads: (external link)
http://links.jstor.org/sici?sici=0741-6261%2819982 ... O%3B2-3&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

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:rje:randje:v:29:y:1998:i:autumn:p:610-631

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in RAND Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().