IDEAS home Printed from https://ideas.repec.org/p/hal/journl/halshs-01212135.html
   My bibliography  Save this paper

Business intelligence and multimarket competition

Author

Listed:
  • Pascal Billand

    (GATE Lyon Saint-Étienne - Groupe d'Analyse et de Théorie Economique Lyon - Saint-Etienne - ENS de Lyon - École normale supérieure de Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - CNRS - Centre National de la Recherche Scientifique)

  • Christophe Bravard

    (GAEL - Laboratoire d'Economie Appliquée de Grenoble - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique - UGA [2016-2019] - Université Grenoble Alpes [2016-2019], UGA UFR FEG - Université Grenoble Alpes - Faculté d'Économie de Grenoble - UGA [2016-2019] - Université Grenoble Alpes [2016-2019])

  • Subhadip Chakrabarti

    (Subhadip Chakrabarti, School of Management and Economics - QUB - Queen's University [Belfast])

  • Sudipta Sarangi

    (LSU - Louisiana State University, DIW Berlin - Deutsches Institut für Wirtschaftsforschung)

Abstract

We consider a multimarket framework where a set of firms compete on two oligopolistic markets. The cost of production of each firm allows for spillovers across markets, ensuring that output decisions for both markets have to be made jointly. Prior to competing in these markets, firms can establish business intelligence gathering links with other firms. A link formed by a firm generates two types of externalities for competitors and consumers. We characterize the business intelligence equilibrium networks and networks that maximize social welfare. By contrast with single-market competition, we show that in multimarket competition there exist situations where intelligence-gathering activities are underdeveloped with regard to social welfare and should be tolerated, if not encouraged, by public authorities.

Suggested Citation

  • Pascal Billand & Christophe Bravard & Subhadip Chakrabarti & Sudipta Sarangi, 2016. "Business intelligence and multimarket competition," Post-Print halshs-01212135, HAL.
    • Handle: RePEc:hal:journl:halshs-01212135
    DOI: 10.1111/jpet.12180
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
    2. Goyal, Sanjeev & Joshi, Sumit, 2003. "Networks of collaboration in oligopoly," Games and Economic Behavior, Elsevier, vol. 43(1), pages 57-85, April.
    3. Bulow, Jeremy I & Geanakoplos, John D & Klemperer, Paul D, 1985. "Multimarket Oligopoly: Strategic Substitutes and Complements," Journal of Political Economy, University of Chicago Press, vol. 93(3), pages 488-511, June.
    4. Crane, Andrew, 2005. "In the company of spies: When competitive intelligence gathering becomes industrial espionage," Business Horizons, Elsevier, vol. 48(3), pages 233-240.
    5. Francis Bloch, 1995. "Endogenous Structures of Association in Oligopolies," RAND Journal of Economics, The RAND Corporation, vol. 26(3), pages 537-556, Autumn.
    6. B. Douglas Bernheim & Michael D. Whinston, 1990. "Multimarket Contact and Collusive Behavior," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 1-26, Spring.
    7. Hackner, Jonas, 2000. "A Note on Price and Quantity Competition in Differentiated Oligopolies," Journal of Economic Theory, Elsevier, vol. 93(2), pages 233-239, August.
    8. Billand, P. & Bravard, C., 2004. "Non-cooperative networks in oligopolies," International Journal of Industrial Organization, Elsevier, vol. 22(5), pages 593-609, May.
    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. Tao Wang, 2020. "Competitive Intelligence and Disclosure of Cost Information in Duopoly," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 57(3), pages 665-699, November.
    2. Adriana Gama & Isabelle Maret & Virginie Masson, 2019. "Endogenous heterogeneity in duopoly with deterministic one-way spillovers," Annals of Finance, Springer, vol. 15(1), pages 103-123, March.
    3. Cuong Le Van & Anh Ngoc Nguyen & Ngoc‐Minh Nguyen & Michel Simioni, 2018. "Growth strategy with social capital, human capital and physical capital—Theory and evidence: The case of Vietnam," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 20(5), pages 768-787, October.
    4. Alex Barrachina & Yair Tauman & Amparo Urbano, 2021. "Entry with two correlated signals: the case of industrial espionage and its positive competitive effects," International Journal of Game Theory, Springer;Game Theory Society, vol. 50(1), pages 241-278, March.
    5. Barrachina, Alex & Forner-Carreras, Teresa, 2022. "Market must be defended: The role of counter-espionage policy in protecting domestic market welfare," Information Economics and Policy, Elsevier, vol. 58(C).
    6. Grandjean, G. & Tellone, D. & Vergote, W., 2017. "Endogenous network formation in a Tullock contest," Mathematical Social Sciences, Elsevier, vol. 85(C), pages 1-10.
    7. Subhadip Chakrabarti & Robert P. Gilles & Emiliya Lazarova, 2021. "Stability of cartels in Multimarket Cournot oligopolies," Manchester School, University of Manchester, vol. 89(1), pages 70-85, January.
    8. Billand, Pascal & Bravard, Christophe & Joshi, Sumit & Mahmud, Ahmed Saber & Sarangi, Sudipta, 2023. "A model of the formation of multilayer networks," Journal of Economic Theory, Elsevier, vol. 213(C).

    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. Pascal Billand & Christophe Bravard & Subhadip Chakrabarti & Sudipta Sarangi, 2014. "A note on networks of collaboration in multi-market oligopolies," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(2), pages 325-335, September.
    2. Bajeux-Besnainou, Isabelle & Joshi, Sumit & Vonortas, Nicholas, 2010. "Uncertainty, networks and real options," Journal of Economic Behavior & Organization, Elsevier, vol. 75(3), pages 523-541, September.
    3. Marco Marini, 2007. "An Overview of Coalition & Network Formation Models for Economic Applications," Working Papers 0712, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2007.
    4. Sudipta Sarangi & Pascal Billand & Christophe Bravard & S. Chakrabarti, 2009. "Spying in Multi-market Oligopolies," Departmental Working Papers 2009-11, Department of Economics, Louisiana State University.
    5. Jean-François Caulier & Ana Mauleon & Vincent Vannetelbosch, 2013. "Contractually stable networks," International Journal of Game Theory, Springer;Game Theory Society, vol. 42(2), pages 483-499, May.
    6. Mohamad Alghamdi, 2023. "Forming Stable R&D Networks in Different Market Structures," Annals of Economics and Finance, Society for AEF, vol. 24(1), pages 91-117, May.
    7. Sanjeev Goyal & José Luis Moraga-González & Alexander Konovalov, 2008. "Hybrid R&D," Journal of the European Economic Association, MIT Press, vol. 6(6), pages 1309-1338, December.
    8. Carlos Ponce & Flavia Roldán, 2016. "Antitrust policies in network environments," Documentos de Investigación 112, Universidad ORT Uruguay. Facultad de Administración y Ciencias Sociales.
    9. Lorenzo Zirulia, 2012. "The role of spillovers in R&D network formation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 21(1), pages 83-105, November.
    10. Pascal Billand & Christophe Bravard & Subhadip Chakrabarti & Sudipta Sarangi, 2013. "Abram Bergson," Working Papers 1339, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    11. Frédéric Deroian, 2005. "Cost-Reducing Alliances and Local Spillovers," Working Papers 2005.10, Fondazione Eni Enrico Mattei.
    12. Jean-François Caulier & Ana Mauleon & Jose Sempere-Monerris & Vincent Vannetelbosch, 2013. "Stable and efficient coalitional networks," Review of Economic Design, Springer;Society for Economic Design, vol. 17(4), pages 249-271, December.
    13. Billand, P. & Bravard, C., 2004. "Non-cooperative networks in oligopolies," International Journal of Industrial Organization, Elsevier, vol. 22(5), pages 593-609, May.
    14. Mauleon, Ana & Sempere-Monerris, Jose J. & Vannetelbosch, Vincent, 2014. "Farsighted R&D networks," Economics Letters, Elsevier, vol. 125(3), pages 340-342.
      • MAULEON, Ana & SEMPERE-MONNERIS, Jose & VANNETELBOSCH, Vincent, 2014. "Farsighted R&D networks," LIDAM Reprints CORE 2653, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
      • MAULEON, Ana & SEMPERE-MONERRIS, Jose J & VANNETELBOSCH, Vincent, 2014. "Farsighted R&D networks," LIDAM Reprints CORE 2632, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    15. Mauleon, Ana & Sempere-Monerris, Jose J. & Vannetelbosch, Vincent, 2023. "R&D network formation with myopic and farsighted firms," Journal of Economic Behavior & Organization, Elsevier, vol. 208(C), pages 203-229.
    16. repec:hal:wpaper:hal-00633611 is not listed on IDEAS
    17. Qiang Gong & Huanxing Yang, 2020. "Collaborative Networks in Oligopoly with Asymmetric Firms," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 56(2), pages 357-380, March.
    18. Deroian, F., 2008. "Dissemination of spillovers in cost-reducing alliances," Research in Economics, Elsevier, vol. 62(1), pages 34-44, March.
    19. Dawid, Herbert & Hellmann, Tim, 2014. "The evolution of R&D networks," Journal of Economic Behavior & Organization, Elsevier, vol. 105(C), pages 158-172.
    20. Marco A. Marini, 2007. "An Overview of Coalitions and Networks Formation Models for Economic Applications," Working Papers 0707, CREI Università degli Studi Roma Tre, revised 2007.
    21. Anthony Ziegelmeyer & Katinka Pantz, 2005. "Collaborative Networks in Experimental Triopolies," Papers on Strategic Interaction 2005-38, Max Planck Institute of Economics, Strategic Interaction Group.

    More about this item

    Keywords

    multi-market competition;

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - 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:hal:journl:halshs-01212135. 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.