Vertical Integration as a Source of Hold-up

• 成果类型: Article
• 署名作者: Allain, Marie-Laure; Chambolle, Claire; Rey, Patrick
• 署名单位: Institut Polytechnique de Paris; Ecole Polytechnique; INRAE; Universite Paris Saclay; Universite de Toulouse; Universite Toulouse 1 Capitole; Toulouse School of Economics
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdv035
• 发表日期: 2016
• 页码: 1-25
• 关键词: competition; foreclosure; CONTRACTS

摘要

While vertical integration is traditionally seen as a solution to the hold-up problem, this article highlights instead that it can generate hold-up problems-for rivals. We consider a successive duopoly where downstream firms invest and then secure support from an upstream supplier. We first show that vertical integration generates ex ante incentives to create hold-up problems: an integrated supplier is willing to pre-commit itself to appropriating or dissipating part of its customer's profits, to expose the independent rival to being held-up by the other supplier, and discourage in this way the rival's investment. We then show that, even in the absence of any pre-commitment, vertical integration also creates hold-up problems ex post when degrading the quality of the support provided to one downstream firm benefits its rival. We also provide illustrations in terms of standard industrial organization models and of antitrust cases, and discuss the robustness of the insights.