Partial Ownership of Suppliers Boosts Consumer Welfare, Reduces Double Marginalization
The article explores how consumer benefits can change when downstream companies partially own an input supplier. When downstream firms have some control over the supplier, consumers may benefit more, even if the ownership is not complete. This is because partial ownership can reduce price markups and allow downstream firms to transfer value from independent shareholders. In simple terms, when downstream companies have a say in the supplier, consumers might get better deals.