Targeting efforts to raise rivals' costs: Moving from “Whether” to “Whom”

• Autores: David M. Mandy, John W. Mayo, David E.M. Sappington
• Localización: International journal of industrial organization, ISSN 0167-7187, Vol. 46, Nº. 0, 2016, págs. 1-15
• Idioma: inglés
• DOI: 10.1016/j.ijindorg.2016.01.002
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• Resumen

  • Abstract Considerable attention has been devoted to determining when a vertically integrated provider (VIP) of an essential input will disadvantage its rivals anticompetitively. In contrast, little attention has been devoted to identifying which of its rivals a VIP will target for cost-raising activities. We identify industry and firm characteristics that render a particular rival a more likely target for a VIP's cost-raising activities. The potential for targeted “sabotage” introduces many subtleties, including the fact that a VIP typically prefers to sabotage an industry leader under retail quantity competition but an industry follower under price competition.