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Journal of Economic Theory and Econometrics
Journal of the Korean Econometric Society
Digital Convergence and Conglomerate Mergers
Vol.22, No.3, September 2011, 62–85
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Chongmin Kim
(Dept. of Economics, Kookmin University)
In Ho Lee
(Dept. of Economics, Seoul National University)
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Abstract
We develop a formal model to deal with bundling in complementary markets. We develop the antitrust analysis of a merger between potentially complementary product producing firms when the merged firm might engage in bundling such as the proposed GE/Honeywell merger. Our model can be applied to the analysis of economic consequences of digital convergence. We show that the new multi-functional product as an outcome of digital convergence of two different products does not necessarily enhance competition in markets.
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Keywords
Bundling, Technical Integration, Digital convergence, Complementary products |
JEL classification codes
D4, L4, Q3 |
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