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Strategic vertical integration without foreclosure


  • Avenel, Eric



We determine the endogenous degree of vertical integration in a model of successive oligopoly that captures both efficiency gains and strategic effects. We show that vertical merger waves can be expected to stop by themselves before integration is complete. Consequently, vertical foreclosure plays no significant role in this paper that claims for a soft approach of vertical integration by antitrust authorities.

Suggested Citation

  • Avenel, Eric, 2003. "Strategic vertical integration without foreclosure," Royal Economic Society Annual Conference 2003 11, Royal Economic Society.
  • Handle: RePEc:ecj:ac2003:11

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    Cited by:

    1. Gärtner, Dennis L. & Halbheer, Daniel, 2009. "Are there waves in merger activity after all?," International Journal of Industrial Organization, Elsevier, vol. 27(6), pages 708-718, November.
    2. Emanuele Bacchiega & Olivier Bonroy, 2015. "On the benefits of contractual inefficiency in quality-differentiated markets," Oxford Economic Papers, Oxford University Press, vol. 67(3), pages 846-863.
    3. Assaf, A. George & Barros, Carlos & Sellers-Rubio, Ricardo, 2011. "Efficiency determinants in retail stores: a Bayesian framework," Omega, Elsevier, vol. 39(3), pages 283-292, June.
    4. Éric Avenel & Stéphane Caprice, 2012. "Collusion and downstream entry in a vertically integrated industry," Economics Working Paper Archive (University of Rennes 1 & University of Caen) 201208, Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS.
    5. Avenel, Eric & Caprice, Stéphane, 2015. "Collusion et possibilité d’entrée en aval dans une industrie verticalement intégrée," TSE Working Papers 15-613, Toulouse School of Economics (TSE).

    More about this item


    merger waves; vertical integration; vertical foreclosure;

    JEL classification:

    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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