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Title:Corporate espionage PDF Logo
Authors:Billand, Pascal
Bravard, Christophe
Chakrabarti, Subhadip
Sarangi, Sudipta
Issue Date:2009
Series/Report no.:Discussion papers // German Institute for Economic Research 854
Abstract:We consider a multimarket framework where a set of firms compete on two interrelated oligopolistic markets. Prior to competing in these markets, firms can spy on others in order to increase the quality of their product. We characterize the equilibrium espionage networks and networks that maximize social welfare under the most interesting scenario of diseconomies of scope. We find that in some situations firms may refrain from spying even if it is costless. Moreover, even though spying leads to increased product quality, there exist situations where it is detrimental to both consumer welfare and social welfare.
Subjects:Oligopoly
multimarket
networks
JEL:C70
L13
L20
Document Type:Working Paper
Appears in Collections:Publikationen von Forscherinnen und Forschern des DIW
DIW-Diskussionspapiere

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