Abstract and Keywords
In theory, a buyer with monopsony power can exclude competitors and increase its power by engaging in predatory buying. The practice involves increasing the price paid for an input above the monopsony price that would otherwise prevail to achieve an anticompetitive effect. A buyer may profit solely by inflicting a loss on suppliers of the input, if it does not compete with input buyers in an output market and lowers input price after competing buyers are excluded. A buyer may also profit if it is a monopolist in an output market and does not compete in that market with competing buyers or competes with at least a group of the same competitors in both the input and output markets, using higher input prices to increase the costs of competing output sellers. But the use of predatory buying as an anticompetitive strategy in these contexts has different economic and legal implications.
Access to the complete content on Oxford Handbooks Online requires a subscription or purchase. Public users are able to search the site and view the abstracts and keywords for each book and chapter without a subscription.
If you have purchased a print title that contains an access token, please see the token for information about how to register your code.