Endogenous choice of price or quantity contract with partial vertical ownership
Abstract
We analyse a supply chain comprising an upstream firm and two downstream firms, which hold partial vertical ownership in the upstream firm. We investigate how these downstream firms choose to compete on either quantity or price. Our findings suggest that outcomes depend on the degree of partial vertical ownership and the level of product substitutability, resulting in potential equilibria including Cournot, Bertrand, and Cournot – Bertrand competition.
Fields of Study & Subjects
Economic theories and models
Auction Theory and Applications
Merger and Competition Analysis
Publication details
- Journal / source
- Applied Economics Letters
- Publisher
- Informa UK Limited
- Pages
- 1–6
- Publication date
- 6 January 2026
- Language
- EN