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Bundling and Mergers in Energy Markets

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  • Granier, Laurent
  • Podesta, Marion

Abstract

Does bundling trigger mergers in energy industries? We observe mergers between firms belonging to various energy markets, for instance between gas and electricity providers. These mergers enable firms to bundle. We consider two horizontally differentiated markets. In this framework, we show that bundling strategies in energy markets create incentives to form multi-market firms in order to supply bi-energy packages. Moreover, we find that this type of merger is detrimental to social welfare.

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Bibliographic Info

Article provided by Elsevier in its journal Energy Economics.

Volume (Year): 32 (2010)
Issue (Month): 6 (November)
Pages: 1316-1324

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Handle: RePEc:eee:eneeco:v:32:y:2010:i:6:p:1316-1324

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Web page: http://www.elsevier.com/locate/eneco

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Keywords: Product Bundling Endogenous Mergers Energy Markets;

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References

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Citations

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Cited by:
  1. Juan-Pablo Montero & Esperanza Johnson, 2012. "Multimarket Contact, Bundling and Collusive Behavior," Documentos de Trabajo, Instituto de Economia. Pontificia Universidad Católica de Chile. 420, Instituto de Economia. Pontificia Universidad Católica de Chile..
  2. Kamiński, Jacek, 2014. "A blocked takeover in the Polish power sector: A model-based analysis," Energy Policy, Elsevier, vol. 66(C), pages 42-52.
  3. Marie-Noëlle Calès & Laurent Granier & Nadège Marchand, 2012. "Competition between clearing houses on the European market," Working Papers, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure 1206, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  4. Ng, Alex & Donker, Han, 2013. "Purchasing reserves and commodity market timing as takeover motives in the oil and gas industry," Energy Economics, Elsevier, Elsevier, vol. 37(C), pages 167-181.

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