Horizontal and Vertial Integration in the Presence of Research Spillovers

Stefania Borla

Discussion Papers from Department of Economics, University of York

Abstract: We investigate how different types of merger affect input prices, research levels and equilibrium profits in vertical market structures when there is research activity in the upstream market that spills over to the downstream retailers. To do so, we develop a very simple model where three downstream Cournot oligopolists are served by monopolist plant-specific input suppliers. We consider a situation in which both vertical and horizontal integration are feasible and we investigate which equilibrium structures are likely to emerge following an initial merger between two units.

Keywords: integration; researh spillovers; sequential mergers (search for similar items in EconPapers)
JEL-codes: L13 L22 L41 (search for similar items in EconPapers)
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