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A Model of Endogenous Cross-Holdings in Oligopoly

Author

Listed:
  • Cheng-Zhong Qin

    (Department of Economics, University of California, Santa Barbara, CA 93106-9210, USA)

  • Dandan Zhu

    (Department of Economics, University of California, Santa Barbara, CA 93106-9210, USA)

  • Shengping Zhang

    (Guanghua School of Management, Peking University, Beijing 100871, China)

Abstract

A network approach is proposed to analyze the formation of cross-holdings and anti-competitive implications. Our approach is motivated by the bilateral arrangement of passive ownership between Microsoft and Apple in 1997. We provide a complete characterization of pairwise stable cross-holdings for a model of Cournot oligopoly with a homogeneous product. Our results strengthen the competitive implications of endogenous cross-holdings in Cournot oligopoly found in the literature.

Suggested Citation

  • Cheng-Zhong Qin & Dandan Zhu & Shengping Zhang, 2017. "A Model of Endogenous Cross-Holdings in Oligopoly," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 12(3), pages 465-479, September.
    • Handle: RePEc:fec:journl:v:12:y:2017:i:3:p:465-479
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    File URL: http://journal.hep.com.cn/fec/EN/10.3868/s060-006-017-0020-6
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    Citations

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    Cited by:

    1. Chen, Zhiqi & Ross, Thomas W., 2020. "Buffer joint ventures," International Journal of Industrial Organization, Elsevier, vol. 73(C).
    2. Kanjilal, Kiriti & Munoz-Garcia, Felix, 2018. "Common Pool Resources with Endogenous Equity Shares," Working Papers 2018-4, School of Economic Sciences, Washington State University.
    3. Luciano Fanti & Domenico Buccella, 2021. "Strategic trade policy with interlocking cross-ownership," Journal of Economics, Springer, vol. 134(2), pages 147-174, October.

    More about this item

    Keywords

    cross-holding; Cournot equilibrium; oligopoly; pairwise stability;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • G0 - Financial Economics - - General
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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