Semi-collusion in media markets
Justus Haucap () and
No 11, DICE Discussion Papers from University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)
This paper explores the effects that collusion can have in newspaper markets where firms compete for advertising as well as for readership. We compare three modes of competition: i) competition in the advertising and the reader market, ii) semi-collusion over advertising (with competition in the reader market), and iii) (full) collusion in both the advertising and the reader market. We find that semi-collusion leads to less advertising (but higher advertising prices) and lower copy prices which is beneficial for readers. Under certain circumstances, semi-collusion may even benefit advertisers as newspaper circulation is higher. In addition, total welfare may rise due to semi-collusion. Results under full collusion are ambiguous. However, even under full collusion newspaper copy prices may decrease and welfare may increase.
Keywords: Media Markets; Collusion; Two-Sided Markets (search for similar items in EconPapers)
JEL-codes: L40 L82 D43 K21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-com, nep-cul and nep-ind
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Journal Article: Semi-collusion in media markets (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:dicedp:11
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