University of Cincinnati Lindner College of Business

Pricing to Preclude Sabotage in Regulated Industries
Debashis Pal

Status: Published
Year: 2017
Publication Name: International Journal of Industrial Organization
Volume: 51, Page Number(s): 162-184


We characterize the optimal access price and retail price for a vertically-integrated incumbent supplier (V) that faces limited competition from a new entrant in the retail sector. The optimal prices provide V with a relatively high wholesale profit margin and a relatively low retail profit margin. Consequently, V has no incentive to raise the costs of its retail rival.

Read More View on Google Scholar

UC Authors

Debashis Pal
Debashis Pal