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Upward Pricing Pressure Formulations with Logit Demand and Endogenous Partial Acquisitions

Panagiotis Fotis (), Michael Polemis () and Konstantinos Eleftheriou ()

MPRA Paper from University Library of Munich, Germany

Abstract: The aim of this paper is to derive the formula of Gross Upward Pricing Pressure Index (GUPPI), used on duopoly markets with differentiated products, when we allow for unilateral equity stakes (expressed as a function of victim's market share) to be endogenously determined. The results show that the unilateral effects of partial acquisitions, as they are measured by GUPPI when the percentage of equity stakes of the acquirer in the target firm is considered endogenous, may be higher than in the case where the said percentage is exogenously determined.

Keywords: Differentiated Product Markets; GUPPI; Logit Demand; Endogenous Partial Acquisitions (search for similar items in EconPapers)
JEL-codes: G3 L13 L16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-ger and nep-ind
Date: 2015-03-26
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