IDEAS home Printed from https://ideas.repec.org/a/kap/jeczfn/v108y2013i3p291-298.html
   My bibliography  Save this article

A note on merger in mixed duopoly: Bertrand versus Cournot

Author

Listed:
  • Kai Andree

Abstract

In this note we analyze the incentives to merge in a mixed duopoly if firms compete in prices or quantities. Our model framework mainly follows Barcena-Ruiz and Garzon (J Econ 80:27–42, 2003 ) who set up the model with quantity competition. We extend their analysis by analyzing the case of competition in prices. Further we compare the incentives to merge with Bertrand and Cournot competition. Comparing quantity with price competition we can show that a merger is more likely with Cournot competition than with Bertrand competition. Copyright Springer-Verlag 2013

Suggested Citation

  • Kai Andree, 2013. "A note on merger in mixed duopoly: Bertrand versus Cournot," Journal of Economics, Springer, vol. 108(3), pages 291-298, April.
    • Handle: RePEc:kap:jeczfn:v:108:y:2013:i:3:p:291-298
    DOI: 10.1007/s00712-012-0280-x
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s00712-012-0280-x
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s00712-012-0280-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yasuhiko Nakamura & Tomohiro Inoue, 2007. "Mixed Oligopoly and Productivity-Improving Mergers," Economics Bulletin, AccessEcon, vol. 12(20), pages 1-9.
    2. Kohei Kamaga & Yasuhiko Nakamura, 2007. "The Core and Productivity-Improving Mergers in Mixed Oligopoly," International Journal of Business and Economics, School of Management Development, Feng Chia University, Taichung, Taiwan, vol. 6(3), pages 181-198, December.
    3. Juan Carlos Bárcena-Ruiz & María Begoña Garzón, 2003. "Mixed Duopoly, Merger and Multiproduct Firms," Journal of Economics, Springer, vol. 80(1), pages 27-42, August.
    4. Stephen W. Salant & Sheldon Switzer & Robert J. Reynolds, 1983. "Losses From Horizontal Merger: The Effects of an Exogenous Change in Industry Structure on Cournot-Nash Equilibrium," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(2), pages 185-199.
    5. repec:ebl:ecbull:v:12:y:2007:i:20:p:1-9 is not listed on IDEAS
    6. José Méndez-Naya, 2008. "Merger profitability in mixed oligopoly," Journal of Economics, Springer, vol. 94(2), pages 167-176, July.
    7. Perry, Martin K & Porter, Robert H, 1985. "Oligopoly and the Incentive for Horizontal Merger," American Economic Review, American Economic Association, vol. 75(1), pages 219-227, March.
    8. Ghosh, Arghya & Mitra, Manipushpak, 2010. "Comparing Bertrand and Cournot in mixed markets," Economics Letters, Elsevier, vol. 109(2), pages 72-74, November.
    9. Raymond Deneckere & Carl Davidson, 1985. "Incentives to Form Coalitions with Bertrand Competition," RAND Journal of Economics, The RAND Corporation, vol. 16(4), pages 473-486, Winter.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fanti, Luciano & Buccella, Domenico, 2018. "Corporate social responsibility and the choice of price versus quantities," Japan and the World Economy, Elsevier, vol. 48(C), pages 71-78.
    2. Pu†yan Nie, 2018. "Comparing Horizontal Mergers Under Cournot with Bertrand Competitions," Australian Economic Papers, Wiley Blackwell, vol. 57(1), pages 55-80, March.
    3. Bárcena-Ruiz, Juan Carlos & Garzón, María Begoña, 2020. "Mergers between local public firms," The North American Journal of Economics and Finance, Elsevier, vol. 51(C).
    4. Nie, Pu-yan & Wang, Chan & Wen, Hong-xing, 2021. "Horizontal mergers under uniform resource constraints," Journal of Retailing and Consumer Services, Elsevier, vol. 63(C).
    5. Dong, Quan & Bárcena-Ruiz, Juan Carlos & Garzón, María Begoña, 2024. "Cooperation between governments to set up public firms," Economic Systems, Elsevier, vol. 48(2).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sylvain Kadohognon Ouattara, 2011. "Incitations à fusionner dans un oligopole mixte asymétrique," Economics Working Paper Archive (University of Rennes & University of Caen) 201126, Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS.
    2. Kadohognon Sylvain Ouattara, 2015. "Incentives to merge in asymmetric mixed oligopoly," Economics Bulletin, AccessEcon, vol. 35(2), pages 885-895.
    3. Gelves, J. Alejandro & Heywood, John S., 2013. "Privatizing by merger: The case of an inefficient public leader," International Review of Economics & Finance, Elsevier, vol. 27(C), pages 69-79.
    4. Kanjilal, Kiriti & Espinola-Arredondo, Ana & Munoz-Garcia, Felix, 2022. "Does the presence of a public firm facilitate merger approvals?," Economics Letters, Elsevier, vol. 219(C).
    5. Yoshio Kamijo & Yasuhiko Nakamura, 2009. "Stable market structures from merger activities in mixed oligopoly with asymmetric costs," Journal of Economics, Springer, vol. 98(1), pages 1-24, September.
    6. Horn, Henrik & Persson, Lars, 2001. "Endogenous mergers in concentrated markets," International Journal of Industrial Organization, Elsevier, vol. 19(8), pages 1213-1244, September.
    7. António Brandão & Joana Pinho & Hélder Vasconcelos, 2014. "Asymmetric Collusion with Growing Demand," Journal of Industry, Competition and Trade, Springer, vol. 14(4), pages 429-472, December.
    8. Huck, Steffen & Konrad, Kai A. & Müller, Wieland, 2000. "Profitable horizontal mergers: A market structure-oriented view," SFB 373 Discussion Papers 2000,27, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
    9. Nilssen, Tore & Sorgard, Lars, 1998. "Sequential horizontal mergers," European Economic Review, Elsevier, vol. 42(9), pages 1683-1702, November.
    10. Robert Town & Douglas Wholey & Roger Feldman & Lawton R. Burns, 2006. "The Welfare Consequences of Hospital Mergers," NBER Working Papers 12244, National Bureau of Economic Research, Inc.
    11. Gugler, Klaus & Szücs, Florian, 2013. "Spillover effects in oligopolistic markets," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79905, Verein für Socialpolitik / German Economic Association.
    12. Boone, Jan, 2006. "Firms Merge in Response to Constraints," CEPR Discussion Papers 5744, C.E.P.R. Discussion Papers.
    13. J. Peter Neary, 2007. "Cross-Border Mergers as Instruments of Comparative Advantage," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 74(4), pages 1229-1257.
    14. Gonzalez-Maestre, Miguel & Lopez-Cunat, Javier, 2001. "Delegation and mergers in oligopoly," International Journal of Industrial Organization, Elsevier, vol. 19(8), pages 1263-1279, September.
    15. Santos-Pinto, Luís, 2010. "The impact of firm cost and market size asymmetries on national mergers in a three-country model," International Journal of Industrial Organization, Elsevier, vol. 28(6), pages 682-694, November.
    16. Chen, Jiawei, 2009. "The effects of mergers with dynamic capacity accumulation," International Journal of Industrial Organization, Elsevier, vol. 27(1), pages 92-109, January.
    17. Hisashi Sawaki, 2015. "Horizontal Mergers Under Asymmetric Information About Synergies," Australian Economic Papers, Wiley Blackwell, vol. 54(3), pages 167-184, September.
    18. Inderst, Roman & Wey, Christian, 2004. "The incentives for takeover in oligopoly," International Journal of Industrial Organization, Elsevier, vol. 22(8-9), pages 1067-1089, November.
    19. Steffen Huck & Kai A. Konrad & Wieland Müller, 2000. "Merger in Contests," CESifo Working Paper Series 241, CESifo.
      • Huck, Steffen & Konrad, Kai A. & Müller, Wieland, 2000. "Merger in contests," SFB 373 Discussion Papers 2000,3, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
    20. Emilie Dargaud, 2013. "Horizontal mergers, efficiency gains and remedies," European Journal of Law and Economics, Springer, vol. 36(2), pages 349-372, October.

    More about this item

    Keywords

    Merger; Price competition; Mixed duopoly; L13; L32; L00;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • L00 - Industrial Organization - - General - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jeczfn:v:108:y:2013:i:3:p:291-298. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.