Horizontal shareholding interlocks induce Cournot industries to restrict production. The cartelizing effects of horizontal shareholding interlocks are greater if firms are mindful of indirect shareholding links than if only attentive to direct links. Indirect shareholding exists when a firm A holds stock in B and B holds stock in C. Several algebraic examples of Cournot industries with shareholding interlocks are explored.
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David Flath (1992) studied this question.
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