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Upstream market structure and the timing of technology adoption

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  • Maria Alipranti
  • Emmanuel Petrakis

Abstract

We study the timing of new cost‐reducing technology adoption in vertically related markets with either upstream monopoly or upstream separate suppliers. We find that technology adoption in the downstream market can take place earlier under upstream monopoly than under upstream separate suppliers. Hence, an upstream monopoly supplier can accelerate the adoption of new technology downstream. We also show that this finding does not depend on the particular features of a vertically related market, such as the contract type through which trading is conducted or the mode of downstream competition.

Suggested Citation

  • Maria Alipranti & Emmanuel Petrakis, 2022. "Upstream market structure and the timing of technology adoption," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(5), pages 1298-1310, July.
    • Handle: RePEc:wly:mgtdec:v:43:y:2022:i:5:p:1298-1310
    DOI: 10.1002/mde.3455
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    1. Aditya Bhattacharjea & Srishti Gupta, 2022. "Alternative Forms of Buyer Power in a Vertical Duopoly: Implications for profits and consumer welfare," Working papers 326, Centre for Development Economics, Delhi School of Economics.

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