Publikationsserver
Biased Quality Investments and Organisational Structures in Network Industries – An Application to the Railway Industry
This paper analyses the incentives to upgrade input quality in vertically related (network) industries. Upstream investments have a biased effect on the downstream companies and lead to vertical product differentiation. Different vertical structures such as vertical integration, ownership and legal...
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| 出版年: | MAGKS - Joint Discussion Paper Series in Economics (Band 09-2011) |
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| 主要な著者: | , |
| フォーマット: | Arbeit |
| 言語: | 英語 |
| 出版事項: |
Philipps-Universität Marburg
2011
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| 主題: | |
| オンライン･アクセス: | PDFフルテキスト |
| タグ: |
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| 要約: | This paper analyses the incentives to upgrade input quality in vertically related (network) industries. Upstream investments have a biased effect on the downstream companies and lead to vertical product differentiation. Different vertical structures such as vertical integration, ownership and legal unbundling lead to different investments. We find that, without regulation, vertical integration and legal unbundling regimes provide highest investment incentives and lead to highest welfare. However, we also find foreclosure in the downstream market if the potential degree of horizontal product differentiation of the entrant is low. Under ownership unbundling, investment incentives are lower but there is never foreclosure of the entrant since this would worsen double marginalisation. When the network operator is subject to a break-even regulation, the investment incentives are crowded out under legal and ownership unbundling whereas they remain nearly unchanged under vertical integration. Welfare and consumer surplus decrease under legal unbundling, but increase under the two other regimes. |
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| 物理的記述: | 39 Seiten |
| ISSN: | 1867-3678 |
| DOI: | 10.17192/es2024.0075 |