Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5078519 | International Journal of Industrial Organization | 2010 | 7 Pages |
Abstract
This paper constructs a model of anticompetitive exclusive dealing in the presence of multiple entrants. Unlike the single-entrant model in previous literature, an entrant competes not only with the incumbent to deal with buyers but also with other entrants. The competition among entrants then serves as a commitment such that low wholesale prices are offered to buyers when they deviate from exclusive contracts. We argue that this commitment effect becomes a barrier to exclusive dealing and that the results differ drastically from the predictions of the single-entrant framework.
Related Topics
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Authors
Hiroshi Kitamura,