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Vertical Mergers And Market Foreclosure

In: Antitrust Law and Economics

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  • William S. Comanor
  • Patrick Rey

Abstract

In recent years, antitrust officials have recognized that vertical arrangements can cause competitive harm through two routes: first, they can facilitate collusion among rivals, and second, they can raise rivals’ costs and thereby create barriers to entry or expansion. In this paper, we identify a third and separate pathway: vertical integration allows upstream monopolists to exploit more fully the market power that has already been attained. We explore the implications of this third pathway for antitrust policy.

Suggested Citation

  • William S. Comanor & Patrick Rey, 2004. "Vertical Mergers And Market Foreclosure," Research in Law and Economics, in: Antitrust Law and Economics, pages 445-458, Emerald Group Publishing Limited.
    • Handle: RePEc:eme:rlwezz:s0193-5895(04)21008-9
    DOI: 10.1016/S0193-5895(04)21008-9
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