Andrey Pleshchynski

The computable model of structural transformation of vertically integrated industries which enterprises apply various strategy of vertical integration and the control in the conditions of oligopoly competition is offered. Demand for the fi nal product and costs at various methods of production of fi rms are described by nonlinear functions with constant elasticity. The developed computer toolkit allows to calculate the prices of the industries’ products, volumes of output and other characteristics of fi rms before integration, as a result of consolidation of manufacturers of intermediate and fi nal products and in case of application of the inter-company interactions mechanism with controllable margin. The numerical example of asymmetrical vertically connected duopolies is given. If margin coeffi cient reduces the contract form of interaction of previous and subsequent fi rms gives the increasing of their total profi t and public welfare to the sizes reached in case of integrated fi rm’s creation.