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horizontal integration and vertical integration

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

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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.

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One cannot be involved in U.S. health care for very long these days without hearing the term "integration." Specifically, we hear a great deal about "horizontal integration" and "vertical integration" of health care services. So, what do these terms really mean? Do you feel that such integration represents positive change for health care delivery in our country? Why, or why not?

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