Note on Stable Mergers in a Market with Asymmetric Substitutability

This paper studies the stability of mergers between firms in a Cournot market. Unlike most existing works, we consider a demand structure where the substitutability between firms is asymmetric. We specifically focus on the stability of the grand coalition by analyzing the core allocation. The main result of our analysis shows that the grand coalition becomes stable, as the market is more asymmetric in terms of substitutability.

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Year of publication:	2013-08-09
Authors:	Watanabe, Takayuki ; Matsubayashi, Nobuo
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 33.2013, 3, p. 2024-2033
Publisher:	AccessEcon
Subject:	Core \| Horizontal merger \| Cournot oligopoly \| Differentiation \| Grand coalition

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Extent:	application/pdf
Type of publication:	Article
Classification:	L1 - Market Structure, Firm Strategy, and Market Performance ; C7 - Game Theory and Bargaining Theory
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010685802