VERTICAL MERGERS AND MARKET FORECLOSURE

William S. Comanor and Patrick Rey

A chapter in Antitrust Law and Economics, 2004, pp 445-458 from Emerald Group Publishing Limited

Abstract: In recent years, antitrust officials have recognized that vertical arrangements can cause competitive harm through two routes: first, they can facilitate collusion among rivals, and second, they can raise rivals’ costs and thereby create barriers to entry or expansion. In this paper, we identify a third and separate pathway: vertical integration allows upstream monopolists to exploit more fully the market power that has already been attained. We explore the implications of this third pathway for antitrust policy.

Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:eme:rlwezz:s0193-5895(04)21008-9

DOI: 10.1016/S0193-5895(04)21008-9

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