AbstractWe consider a multimarket framework where a set of firms compete on two interrelated oligopolistic markets. Prior to competing in these markets, firms can spy on others in order to increase the quality of their product. We characterize the equilibrium espionage networks and networks that maximize social welfare under the most interesting scenario of diseconomies of scope. We find that in some situations firms may refrain from spying even if it is costless. Moreover, even though spying leads to increased product quality, there exist situations where it is detrimental to both consumer welfare and social welfare.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 854.
Length: 29 p.
Date of creation: 2009
Date of revision:
Oligopoly; multimarket; networks;
Find related papers by JEL classification:
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
This paper has been announced in the following NEP Reports:
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Billand, Pascal & Bravard, Christophe & Chakrabarti, Subhadip & Sarangi, Sudipta, 2010. "Networks of Collaboration in Multi-market Oligopolies," MPRA Paper 28188, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bibliothek).
If references are entirely missing, you can add them using this form.