Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

A Member of the Law Professor Blogs Network

Friday, February 18, 2011

Horizontal Mergers, Structural Remedies, and Consumer Welfare in a Cournot Oligopoly with Assets

Posted by D. Daniel Sokol

Thibaud Verg - Autorité de la Concurrence and CREST-LEI discusses Horizontal Mergers, Structural Remedies, and Consumer Welfare in a Cournot Oligopoly with Assets.

ABSTRACT: Competition authorities sometimes require that firms divest some of their assets to rivals in order to allow a merger to take place. This paper extends the results of Farrell and Shapiro [1990a] and shows that, in the absence of technological synergies, a merger is highly unlikely to benefit consumers, even if it is subjected to appropriate structural remedies. For instance, a merger may ultimately lead to a lower price only if at least two different firms acquire the divested assets, and if the merging parties had relatively important pre-merger market shares.

http://lawprofessors.typepad.com/antitrustprof_blog/2011/02/horizontal-mergers-structural-remedies-and-consumer-welfare-in-a-cournot-oligopoly-with-assets.html

| Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef0147e1be6322970b

Listed below are links to weblogs that reference Horizontal Mergers, Structural Remedies, and Consumer Welfare in a Cournot Oligopoly with Assets:

Comments

Post a comment