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Please use this identifier to cite or link to this item: https://hdl.handle.net/2445/104723
Vertical syndication-proof competitive prices in multilateral assignment markets
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Abstract
We consider a market comprising a number of perfectly complementary and homogeneous commodities. We concentrate on the incentives for firms producing these commodities to merge and form a vertical syndicate. The main result establishes that the nucleolus of the associated market game corresponds to the unique vector of prices with the following properties: (i) they are vertical syndication-proof, (ii) they are competitive, (iii) they yield the average of the buyers- and the sellers-optimal allocations in bilateral markets, and (iv) they depend on the traders' bargaining power but not on their identity. The proof uses an isomorphism between our class of market games and the entire class of bankruptcy games.
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TEJADA, Oriol and ÁLVAREZ-MOZOS, Mikel. Vertical syndication-proof competitive prices in multilateral assignment markets. Review of Economic Design. 2016. Vol. 20, num. 4, pags. 289-327. ISSN 1434-4742. [consulted: 9 of August of 2026]. Available at: https://hdl.handle.net/2445/104723