Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100655
Authors: 
Bush, C. Anthony
Year of Publication: 
2014
Series/Report no.: 
Economics Discussion Papers 2014-33
Abstract: 
A general theoretical and empirical framework is developed for assessing the potential of a vertically integrated firm to foreclose downstream competitors. Using this framework a policymaker may also evaluate the empirical welfare effects from a vertically integrated firm raising rivals' costs. The framework is developed within the context of a vertically integrated multichannel video programming distributor ("MVPD"), and this framework extends the applicability of PCAIDS to vertical mergers. Using public data from the Comcast-Time Warner-Adelphia Merger Order of the Federal Communications Commission, price effects from the threat and action of foreclosure in several designated marketing areas were simulated. Empirical results suggest that the Commission Staff Model substantially underestimated price increases to end users as a result of the threat and action of foreclosure. Empirical results suggest that Commission's Program Access Rules were essential for MVPD competition.
Subjects: 
Mergers
merger simulation
vertical merger
horizontal merger
telecommunications
PCAIDS
foreclosure
raising rival's cost
two-sided markets
JEL: 
C15
C01
C02
C53
C61
D4
K2
L1
L96
Creative Commons License: 
http://creativecommons.org/licenses/by/3.0/
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.