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Regulation of vertical integration of enterprises – between economic theory and the practice of law

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  • Mikolaj Klimczak

    (Wroclaw University of Economics)

Abstract

Cooperation of companies in the production chain is one of the less frequently discussed issues in economics, both theoretically and practically. Vertical integration of enterprises can take two forms: vertical mergers and vertical restraints, which are used in different situations in order to reduce transaction costs, ensure stability of supply and overall coordination. Both of these aspects of integration lead to certain internal and external effects which may have either a positive or negative influence on competition, markets and the economy as a whole. Hence, the are differences among researchers as well as regulators in the perception and evaluation of the phenomena associated with vertical integration of enterprises. The aim of this article is to present the current output of the theoretical analysis of regulation of vertical integration of enterprises and a reference of the output to the world’s current legal solutions that are derived from the U.S. laws. The author hypothesizes that, owing to the multidimensional nature and potentially opposite effects of the processes of integration, they must be considered individually, but a certain group of determinants that can help in the evaluation of these processes in terms of competition and welfare may be indicated.

Suggested Citation

  • Mikolaj Klimczak, 2012. "Regulation of vertical integration of enterprises – between economic theory and the practice of law," Ekonomia i Prawo, Uniwersytet Mikolaja Kopernika, vol. 8(1), pages 107-118, March.
    • Handle: RePEc:cpn:umkeip:v:8:y:2012:i:1:p:107-118
    DOI: 10.12775/EiP.2012.007
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    References listed on IDEAS

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    2. Black,Oliver, 2010. "Conceptual Foundations of Antitrust," Cambridge Books, Cambridge University Press, number 9780521142076.
    3. Michael A. Salinger, 1988. "Vertical Mergers and Market Foreclosure," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 103(2), pages 345-356.
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    Keywords

    vertical integration; enterprises;

    JEL classification:

    • A - General Economics and Teaching

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