It is shown that even when vertical integration leads to an upstream monopoly, welfare can improve if the ex ante market share of the merging firm is large. This result is obtained in a Cournot-Nash equilibrium context with asymmetric marginal costs of production.
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Paper provided by Institut National de la Statistique et des Etudes Economiques- in its series Papers with number
2000-42.
Length: 30 pages Date of creation: 2000 Date of revision: Handle: RePEc:fth:inseep:2000-42
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