Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/43667
Authors: 
Dewenter, Ralf
Haucap, Justus
Wenzel, Tobias
Year of Publication: 
2010
Series/Report no.: 
DICE discussion paper 11
Abstract: 
This paper explores the effects that collusion can have in newspaper markets where firms compete for advertising as well as for readership. We compare three modes of competition: i) competition in the advertising and the reader market, ii) semi-collusion over advertising (with competition in the reader market), and iii) (full) collusion in both the advertising and the reader market. We find that semi-collusion leads to less advertising (but higher advertising prices) and lower copy prices which is beneficial for readers. Under certain circumstances, semi-collusion may even benefit advertisers as newspaper circulation is higher. In addition, total welfare may rise due to semi-collusion. Results under full collusion are ambiguous. However, even under full collusion newspaper copy prices may decrease and welfare may increase.
Subjects: 
Media Markets
Collusion
Two-Sided Markets
JEL: 
L40
L82
D43
K21
ISBN: 
978-3-86304-010-9
Document Type: 
Working Paper

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