Market Analysis in the Presence of Indirect Constraints and Captive Sales

Roman Inderst and Tommaso Valletti

CEIS Research Paper from Tor Vergata University, CEIS

Abstract: This paper analyzes merchant markets in the presence of vertically-integrated firms. We discuss when vertical integration tends to increase the elasticity of (derived) demand in the merchant market because of indirect contraints arising from the retail market. We also discuss the relevance of different measures of market power such as market shares in the wholesale or retail market. We provide insights into the likely effect of an upstream merger under vertical integration, depending on, for instance, whether the integrated firm currently sells into the merchant market or whether this can be expected after the merger.

Keywords: market definition; wholesale; SSNIP; vertical integration (search for similar items in EconPapers)
JEL-codes: L40 (search for similar items in EconPapers)
Pages: 44
Date: 2006-09-01
New Economics Papers: this item is included in nep-com
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Citations: View citations in EconPapers (9)

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Journal Article: MARKET ANALYSIS IN THE PRESENCE OF INDIRECT CONSTRAINTS AND CAPTIVE SALES (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:rtv:ceisrp:74

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