Anti-Competitive Effects of Partial Cross-Ownership: Experimental Evidence
39 Pages Posted: 29 Apr 2021
Date Written: March 24, 2021
In theory, partial cross-ownership affects product prices and consumer welfare negatively, but empirical evidence is highly controversial. For competition policy it is important whether such effects are substantial enough to cause action. We report a lab experiment on a homogeneous duopoly market with symmetric passive crossownership in which the degree of cross-ownership varies between treatments (LOW vs HIGH). We argue that the observed negative effects are substantial enough to be considered problematic in real markets.
Keywords: cross–ownership, common ownership, minority shareholdings, silent financial interest, Cournot experiment
JEL Classification: C91, L41, L22, D43
Suggested Citation: Suggested Citation