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horizontal integration and vertical integration


What is the difference between horizontal integration and vertical integration? How does antitrust policy affect the nature of mergers?

© BrainMass Inc. brainmass.com September 24, 2018, 7:34 pm ad1c9bdddf - https://brainmass.com/business/finance/horizontal-integration-and-vertical-integration-25051

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Vertical integration is application integration in support of a particular type of business, such as healthcare, finance, manufacturing, etc. These industries require a specific type of integration typically around standards they employ, such as HIPPA (healthcare), UCCnet (retail), RossettaNet (high-tech), and GSTP (finance).

Horizontal integration is integration types that are common to all industries, such as basic integration services including transformation, routing, adapters, flow control, etc.

Advantages of Horizontal Integration: economies of scale-achieved by selling more of the same product, economies of scope-achieved by sharing resources common to different products, increased market power (over suppliers and downstream channel members) and reduction in the cost of international trade by operating ractories in foreign markets.

Disadvantages of Horizontal ...

Solution Summary

Horizontal integration and vertical integration are contrasted.