We analyze an industry where a dominant buyer may foreclose its rivals (with whom competes a la Cournot in the final good market) from access to an efficient supplier of an intermediate good. We prove that the presence of asymmetric information between this dominant buyer and its supplier may mitigate the incentives for the dominant buyer to exert such a vertical restraint. If the dominant buyer's bargaining power is not too strong, the presence of such an informal asymmetry has a positive impact on welfare.
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Paper provided by Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC) in its series UFAE and IAE Working Papers with number
402.97.