Wednesday, April 30, 2008
Posted by D. Daniel Sokol
A new article on The Role of Economic Evidence in Merger Control in Ireland: Current and Future Practice by Brendan O'Connor, Commission for Aviation Regulation; Cormac Keating, The Competition Authority; and Paul K. Gorecki, Competition Authority, Dublin provides us an overview of developments in the Celtic Tiger.
ABSTRACT: Having reviewed some 311 cases notified to the Irish Competition Authority during 2003-2006 this paper examines economic evidence and how it relates to factual and opinion evidence in testing for SLC. The analysis focuses on the use of economic evidence in the assessment of horizontal mergers with unilateral effects and sets out a framework for the application of economic evidence. The authors note that economic evidence was only relied on in a minority of cases, and never in isolation from factual and/or opinion evidence. Having reflected on some of the economic techniques used in Irish merger cases the authors conclude that there may be no more than a limited role for merger simulation models and analysed why, despite an extensive literature on their relevance to merger review, efficiencies have played only a minor role in merger notifications and have not been supported by quantitative evidence. Finally the authors discuss the incentives the underlie competitor and customer opinion evidence and how biases in opinion evidence can be controlled for.