# Bias figures long_new

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```					    Monopoly power Monopoly power is Monopoly power is

1

ρ

~
ρ(Α,β,π)

0                 _
0             β           ρ                      1

Citizen preference parameter, β.

Figure 1: The Suspicion Effect: When is Monopoly
−3
x 10
3

2.5

2

1.5
∆(β,π)

1

0.5

0

−0.5

−1

−1.5
0.9
0.8
0.7                                                                                                0.8
0.6                                                                                    0.7
0.6
0.5
0.5
0.4                                                  0.4
0.3                                  0.3
0.2
0.2
¡

0.1
0.1   0

Figure 2: The Publisher’s Bargainning Surplus
1

0.9

0.8

0.7       A Monopoly
Competition                          B Monopoly

0.6

0.5
π

0.4

0.3

Both A as well as B monopoly is equilibrium
0.2

0.1                                               No Entry

0
0     0.1         0.2       0.3       0.4        0.5       0.6     0.7      0.8        0.9    1
β
Figure 3: Equilibrium Market Structure Without Mergers−Dominant Profit Motive
1

0.9                                                 competition
changes
to monopoly
0.8

0.7

A Monopoly                                                                    B Monopoly
0.6

0.5
π

Competition
0.4

0.3

0.2
Both A as well as B monopoly are equilibrium

0.1                                                 No Entry

0
0       0.1         0.2       0.3       0.4        0.5       0.6      0.7     0.8        0.9         1
β
Figure 4: Equilibrium Market Structure Allowing Mergers− Dominant Profit Motive
Figure 5: The Suspicion Region
betabar
1                                                             0.5       0
0
 ¨ ¨ (  ¦
87%6(543\$21¤¤¨0§¤ & ¢
 ¨ ¦ \$   ¤
¢
0.5
π(betabar)

1
1

0.9                                                No
Equilibrium
In Pure
0.8                                                Strategies

0.7

Competition
Competition
0.6

0.5
π

0.4

0.3

0.2       A                                                                                      B
Monopoly                                                                               Monopoly

0.1
No Entry                   B Monopoly            A Monopoly                     No Entry

0
0        0.1    0.2       0.3        0.4        0.5        0.6        0.7      0.8        0.9         1
β
Figure 6: Alpha=1, no mergers allowed
1

0.9

0.8

0.7 A Monopoly             Competition                                              B Monopoly

0.6

0.5
π

0.4

0.3

0.2
No Entry                                                                  No Entry
0.1

0
0    0.1       0.2     0.3         0.4      0.5       0.6      0.7      0.8      0.9       1
β
Figure 7: Alpha=0.05, no mergers allowed
1

0.9                    Competition

0.8

0.7

No
0.6                                             Equlibrium
in Pure
A Monopoly                            Strategies                     B
0.5                                                                            Monopoly
π

0.4

0.3

0.2

0.1
No Entry

0
0     0.1        0.2     0.3        0.4      0.5       0.6   0.7   0.8        0.9   1
β
Figure 8: Alpha=0.01, no mergers allowed
1

0.9

0.8                                              Competition

0.7
A Monopoly
B
0.6
Monopoly

0.5
π

0.4

0.3
No Equilibrium In
Pure Strategies
0.2

0.1                                             No Entry

0
0      0.1          0.2   0.3       0.4       0.5      0.6       0.7   0.8      0.9     1
β
Figure 9: Alpha=0.001, no mergers allowed
1

0.9

0.8

0.7
B monopoly
A monopoly
Competition
0.6

0.5
π

0.4

0.3

0.2
No Entry
No Entry
0.1

0
0       0.1      0.2       0.3        0.4        0.5      0.6       0.7          0.8      0.9        1
β
Fig 10: Alpha=1, mergers allowed
Outcome changes to B monopoly
Outcome changes to A monopoly
1

0.9

0.7

0.6
Competition                         Competition

A Monopoly
0.5
π

B Monopoly

0.4

0.3

0.2
No Entry                                                                  No Entry

0.1

0
0       0.1        0.2      0.3         0.4      0.5      0.6       0.7        0.8     0.9        1
β
Figure 12: Alpha= 0.05, mergers allowed
1

0.9
Outcome changes to A monopoly

0.8
Outcome changes to B monopoly

0.7
Competition
A Monopoly                                                                          B Monopoly
0.6

0.5
π

0.4

0.3

0.2

0.1                                                  No Entry

0
0      0.1        0.2       0.3         0.4       0.5       0.6      0.7          0.8        0.9     1
β
Figure 13: Alpha= 0.001, mergers allowed

```
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