Sappington, David; Weisman, Dennis - In: Journal of Regulatory Economics 27 (2005) 2, pp. 155-175
We analyze the incentives of a vertically-integrated producer (VIP) to engage in “self-sabotage”.Self-sabotage occurs … conditions under which self-sabotage is profitable for the VIP even though it raises symmetrically the cost of the upstream … conditions, self-sabotage can enable a VIP to disadvantage downstream rivals differentially without violating parity requirements …