Free Entry in a Cournot Market with Overlapping Ownership

• 成果类型: Article
• 署名作者: Vives, Xavier; Vravosinos, Orestis
• 署名单位: University of Navarra; IESE Business School; Centre for Economic Policy Research - UK; New York University
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20230331
• 发表日期: 2025
• 页码: 292-320
• 关键词: common-ownership; cross-ownership; COMPETITION; BEHAVIOR; COSTS; POWER

摘要

We examine the effects of overlapping ownership among existing firms deciding whether to enter a product market. We show that in most cases-and especially when overlapping ownership is already widespread-an increase in the extent of overlapping ownership will harm welfare by softening product market competition, reducing entry, and thereby (in contrast to standard results) inducing insufficient entry and magnifying the negative impact of an increase of entry costs on entry. Overlapping ownership can mostly be beneficial only under substantial increasing returns to scale, in which case industry consolidation (induced by overlapping ownership) leads to sizable cost efficiencies. (JEL D21, D24, D43, G24, G34, K21, L13)