Vertical Mergers Can Lead to Input Foreclosure, Impacting Rivals' Access
The article explores how vertical mergers can lead to input foreclosure when competitors can use alternative inputs. The researchers investigate whether a low share of input sales to rivals can act as a safe harbor in such cases. They find that when rivals can easily switch to other inputs, vertical mergers are less likely to result in input foreclosure. This suggests that competition concerns may be alleviated when competitors have multiple options for sourcing inputs.