Overlapping ownership, endogenous quality, and welfare

Brito, Duarte; Ribeiro, Ricardo; Vasconcelos, Helder

Publication

Overlapping ownership, endogenous quality, and welfare

2019Working paper

dc.contributor.author	Brito, Duarte
dc.contributor.author	Ribeiro, Ricardo
dc.contributor.author	Vasconcelos, Helder
dc.date.accessioned	2020-01-15T14:55:48Z
dc.date.available	2020-01-15T14:55:48Z
dc.date.issued	2019
dc.description.abstract	This paper investigates how overlapping ownership affects quality levels, consumer surplus, firms' profits and welfare when the industry is a vertically differentiated duopoly and quality choice is endogenous. This issue is particularly relevant since recent empirical evidence suggests that overlapping ownership constitutes an important feature of a multitude of vertically differentiated industries. We show that overlapping ownership while detrimental for welfare, may increase or decrease the quality gap, consumer surplus and firms' profits. In particular, when the overlapping ownership structure is such that the high quality firm places a positive weight on the low quality firm's profits, the incentives of the high quality firm to compete aggressively reduce. This may increase the equilibrium quality of the low quality firm, which in turn may lead to higher consumer surplus, despite higher prices.	pt_PT
dc.description.version	info:eu-repo/semantics/publishedVersion	pt_PT
dc.identifier.citation	Brito, D., Ribeiro, R., Vasconcelos, H. (2019). Overlapping Ownership, Endogenous Quality, and Welfare. Endogenous Quality, and Welfare (November 27, 2019)	pt_PT
dc.identifier.doi	10.2139/ssrn.3494482	pt_PT
dc.identifier.uri	http://hdl.handle.net/10400.14/29265
dc.language.iso	eng	pt_PT
dc.peerreviewed	yes	pt_PT
dc.publisher	Elsevier	pt_PT
dc.rights.uri	http://creativecommons.org/licenses/by/4.0/	pt_PT
dc.subject	Overlapping ownership	pt_PT
dc.subject	Vertical differentiation	pt_PT
dc.title	Overlapping ownership, endogenous quality, and welfare	pt_PT
dc.type	working paper
dspace.entity.type	Publication
oaire.citation.title	SSRN	pt_PT
person.familyName	Ribeiro
person.givenName	Ricardo
person.identifier.ciencia-id	FE1B-059C-9DAF
person.identifier.orcid	0000-0003-4627-4261
person.identifier.rid	R-9464-2017
person.identifier.scopus-author-id	56024991300
rcaap.rights	openAccess	pt_PT
rcaap.type	workingPaper	pt_PT
relation.isAuthorOfPublication	2d2a5676-faf5-464a-9ab3-60fdb90c5e27
relation.isAuthorOfPublication.latestForDiscovery	2d2a5676-faf5-464a-9ab3-60fdb90c5e27