Endogenous Mergers in Endogenous Sunk Cost Industries

• Tipo: Artigo em Revista Científica Internacional
• Data: 2006

Autores

Helder Vasconcelos (Autor) FEP

Revista

Título: International Journal of Industrial Organization

Vol. 24 Nº 2

Páginas: 227-250

ISSN: 0167-7187

Editora: Elsevier

Indexação

ISI Web of Science

Scopus - 13 Citações

Econlit

Classificação Científica

FOS: Ciências sociais > Economia e gestão

Outras Informações

ID Authenticus: P-00F-RXK

DOI: 10.1016/j.ijindorg.2005.11.003

Abstract (EN): This paper uses an endogenous coalition formation game to derive an upper bound to industry concentration. The proposed coalitional stability concept assumes that firms are endowed with foresight in that they look ahead and anticipate the ultimate outcome of their actions. It is shown that while in exogenous sunk cost industries the upper bound to concentration falls as the market becomes large, in endogenous sunk cost industries, regardless of the size of the market, arbitrarily concentrated outcomes can arise in equilibrium. In addition, for this second class of industries, if products are sufficiently good substitutes, then duopoly coalition structures can only be sustained in equilibrium if composed of sufficiently size asymmetric coalitions. The results, therefore, complement those of Sutton [Sutton, J. 1991, Sunk Costs and Market Structure, Cambridge, MA: MIT Press; Sutton, J. 1998, Technology and Market Structure: Theory and History, Cambridge, MA: MIT Press.]

Idioma: Inglês

Tipo (Avaliação Docente): Científica