摘要：To investigate the changes of welfare and the degree of exploitation
in consumer side when the upstream firm enters the downstream market, we
construct a quantity competition model to analyze the changes in consumers’ welfare
and the profits of upstream and downstream firms. The main findings of this
note are as follows: The markup has a negative effect in consumer’s
surplus and the degree of exploitation will deteriorate when the upstream firm
goes into the other market. In addition, the profits in the firm which expands
his production scale to downstream will decline when the markup level rises, but
with no obvious effect in original downstream firm.
