A study on countervailing power from the perspective of outside option

Technology innovation has been recognized as a behavior which can increase buyer´s countervailing power. However, from the perspective of outside option, a model which is built to measure the relationship between buyer´s ability to conduct reverse vertical integration and its buyer power shows although buyer´s merger behavior can promote its ability to invest on technology innovation, the impact of this investment on buyer´s countervailing power is actually uncertain. Base on the conclusions above, the study also discusses how Coca-Cola and Wal-Mart increase their buyer power.