2. Vertical Integration

Define vertical integration

Define vertical restrictions

Advantages for vertical integration

How does Variable-Proportionals Production Function lead to an incentive for vertical integration?

How do vertical restrictions help against the problem of double marginalization?

What is The Free Riding Problem?

How do Vertical Restrictions reduce Free Riding?

How does Free Riding by Manufacturers occur and how do we solve it?

Desirable Welfare Effects of Vertical Restrictions

Ambiguous Welfare Effects of Vertical Restrictions

Undesirable Welfare Effects of Vertical Restrictions