University Library
  • Login
A gateway to Melbourne's research publications
Minerva Access is the University's Institutional Repository. It aims to collect, preserve, and showcase the intellectual output of staff and students of the University of Melbourne for a global audience.
View Item 
  • Minerva Access
  • Business & Economics
  • Economics
  • Economics - Research Publications
  • View Item
  • Minerva Access
  • Business & Economics
  • Economics
  • Economics - Research Publications
  • View Item
JavaScript is disabled for your browser. Some features of this site may not work without it.

    Does structure dominate regulation? The case of an input monopolist

    Thumbnail
    Download
    Does structure dominate regulation? The case of an input monopolist (197.7Kb)

    Citations
    Altmetric
    Author
    King, Stephen P.
    Date
    2000-10
    University of Melbourne Author/s
    King, Stephen
    Affiliation
    Economics and Commerce: Department of Economics
    Metadata
    Show full item record
    Document Type
    Preprint
    Citations
    King, Stephen P. (2000) Does structure dominate regulation? The case of an input monopolist.
    Access Status
    Open Access
    URI
    http://hdl.handle.net/11343/33648
    Description

    ISBN 0-7340-1708-1, Working Paper 767

    Abstract
    This paper constructs a simple repeated game model to analyze how industry outcomes alter if a regulated input monopolist is allowed to integrate into the downstream retail market. Integration helps overcome double marginalization — a feature well known in the existing literature. Unlike existing static models, however, integration also makes tacit collusion more difficultin a repeated game framework. If the regulated input price exceeds marginal cost, an integrated monopolist has an incentive to increase retail sales as this raises upstream profits. It will be less willing to engage in any tacitly collusive conduct in the downstream market and it has a greater incentive to cheat on any collusive arrangement. We show that these effects may dominate input price regulation. A social planner may prefer the upstream monopoly toparticipate in the downstream market, even if integration leads to a higher regulated input price. The anti-competitive effects of the higher input priceare more than offset by the pro-competitive effects of integrati
    Keywords
    Input monopoly; regulation; utility industries; Journal of Economic Literature Classification Numbers: L12; L51; monopoly; monopolization strategies; economics of regulation

    Export Reference in RIS Format     

    Endnote

    • Click on "Export Reference in RIS Format" and choose "open with... Endnote".

    Refworks

    • Click on "Export Reference in RIS Format". Login to Refworks, go to References => Import References


    Collections
    • Economics - Research Publications [584]
    Minerva AccessDepositing Your Work (for University of Melbourne Staff and Students)NewsFAQs

    BrowseCommunities & CollectionsBy Issue DateAuthorsTitlesSubjectsThis CollectionBy Issue DateAuthorsTitlesSubjects
    My AccountLoginRegister
    StatisticsMost Popular ItemsStatistics by CountryMost Popular Authors