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Non-horizontal mergers with investments into compatibility

Gregor Langus, Vilen Lipatov and Jorge Padilla

No 7617, CESifo Working Paper Series from CESifo Group Munich

Abstract: We set up a model to analyze the effects of mergers between sellers of complementary components where firms invest in compatibility and can engage in bundling. We consider the impact of merger on prices, investment and consumer surplus. We also analyse when the merged firm may have an incentive and ability to foreclose rivals.

Keywords: mergers; complementary goods; welfare effects; foreclosure; compatibility (search for similar items in EconPapers)
JEL-codes: L13 L41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-mic and nep-reg
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_7617

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