Cournot Competition and Merge

Li Shaocai, Li Keke. Cournot Competition and Merge[J]. Journal of University of Electronic Science and Technology of China, 1999, 28(6): 618-620.

Citation:

Li Shaocai, Li Keke. Cournot Competition and Merge[J]. Journal of University of Electronic Science and Technology of China, 1999, 28(6): 618-620.

Citation:

Li Shaocai, Li Keke. Cournot Competition and Merge[J]. Journal of University of Electronic Science and Technology of China, 1999, 28(6): 618-620.

Abstract

This paper studies a part of motives of horizontal merge with the frame of Cournot competition. The merge for more market power is unprofitable, but the merge for cost saving can be profitable. It is found that capacity restriction is another cause of merge, and merge are more likely to happen for firms with higher capacity. It is a complement to the theory of merge.

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