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- Title
Partial Ownership and Foreclosure: An Empirical Analysis.
- Authors
Reiffen, David
- Abstract
This paper examines events associated with Union Pacific (UP) Railroad's attempt to obtain a significant minority share of the voting equity in Chicago Northwestern (CNW) Railroad. Rivals of UP petitioned the ICC to block the transaction, positing a theory of foreclosure that connects UP's partial ownership of CNW to reductions in both the rivals' profits and social welfare. This paper explores this theory's implications more generally and generates a testable implication for the UP/CNW transaction. I test for the predicted effect and find evidence contrary to the predictions of the rivals' theory, but consistent with other theories of partial ownership interests.
- Subjects
STOCK ownership; FORECLOSURE; UNION Pacific Railroad Co. Inc.; CHICAGO &; North Western Railway Co.; SALE of business enterprises
- Publication
Journal of Regulatory Economics, 1998, Vol 13, Issue 3, p227
- ISSN
0922-680X
- Publication type
Article
- DOI
10.1023/A:1008077003624