TY - JOUR
T1 - Input price discrimination with passive partial ownership
AU - Hu, Qing
AU - Mizuno, Tomomichi
AU - Song, Junghyun
N1 - Publisher Copyright:
© 2021 Informa UK Limited, trading as Taylor & Francis Group.
PY - 2022
Y1 - 2022
N2 - Passive partial ownership (PPO) is commonly practised in many industries. When operating profits of stock-owned firms decrease, stock-holding firms will increase output to reduce capital gain through owned firms’ stocks. In a vertically related market with downstream PPO, consumer and total surpluses when input price discrimination is allowed may be larger than when it is banned because PPO mitigates effects of reduction in output caused by higher input price.
AB - Passive partial ownership (PPO) is commonly practised in many industries. When operating profits of stock-owned firms decrease, stock-holding firms will increase output to reduce capital gain through owned firms’ stocks. In a vertically related market with downstream PPO, consumer and total surpluses when input price discrimination is allowed may be larger than when it is banned because PPO mitigates effects of reduction in output caused by higher input price.
KW - competition policy
KW - input price discrimination
KW - Passive partial ownership
KW - vertical relationship
UR - http://www.scopus.com/inward/record.url?scp=85101039934&partnerID=8YFLogxK
U2 - 10.1080/13504851.2021.1884831
DO - 10.1080/13504851.2021.1884831
M3 - Article
AN - SCOPUS:85101039934
SN - 1350-4851
VL - 29
SP - 713
EP - 717
JO - Applied Economics Letters
JF - Applied Economics Letters
IS - 8
ER -