The Gains from Forming a Joint Venture in a New Market with Rivals in an Existing Market: the Bertrand Case

Ngo Long and Antoine Soubeyran

G.R.E.Q.A.M. from Universite Aix-Marseille III

Abstract: We show that under Bertrand competition, firms may have an incentive to transfer real ressources to a joint venture operating in an unrelated market. The optimal transfers are typically asymmetric, in order to reduce the extent of rivalry in the oligopoly.

Keywords: MARKET STRUCTURE; OLIGOPOLIES (search for similar items in EconPapers)
JEL-codes: D4 L22 (search for similar items in EconPapers)
Pages: 15 pages
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:fth:aixmeq:96a36

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