Horizontal Mergers and Buying Power
Chambolle, Claire
Horizontal Mergers and Buying Power - 2008.
67
This article analyzes the impact of mergers between retailers in a bilateral-oligopoly situation, when producers and retailers are in a two-on-two negotiation over a unit price in the intermediate market and when retailers are competing over quantity. We show that (i) a reduction in inter-brand competition reduces the individual profitability of an inter-retailer merger; (ii) the formation of a central purchasing entity has negative effects on retailers and consumers alike.
Horizontal Mergers and Buying Power - 2008.
67
This article analyzes the impact of mergers between retailers in a bilateral-oligopoly situation, when producers and retailers are in a two-on-two negotiation over a unit price in the intermediate market and when retailers are competing over quantity. We show that (i) a reduction in inter-brand competition reduces the individual profitability of an inter-retailer merger; (ii) the formation of a central purchasing entity has negative effects on retailers and consumers alike.
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