Dynamic merger review.
We analyze the optimal dynamic policy of an antitrust authority toward horizontal mergers when merger proposals are endogenous and occur over time. Approving a currently proposed merger may affect the profitability and welfare effects of potential future mergers, whose characteristics may not yet be...
| Main Authors: | , |
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| Format: | Journal article |
| Language: | English |
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University of Chicago Press
2010
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| _version_ | 1797093830620610560 |
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| author | Nocke, V Whinston, M |
| author_facet | Nocke, V Whinston, M |
| author_sort | Nocke, V |
| collection | OXFORD |
| description | We analyze the optimal dynamic policy of an antitrust authority toward horizontal mergers when merger proposals are endogenous and occur over time. Approving a currently proposed merger may affect the profitability and welfare effects of potential future mergers, whose characteristics may not yet be known. We identify conditions under which discounted expected consumer surplus is maximized by using a completely myopic merger review policy that approves a merger if and only if it does not lower consumer surplus given the current market structure. We also discuss a number of extensions as well as factors that undermine the optimality of myopic merger review policies. |
| first_indexed | 2024-03-07T04:05:49Z |
| format | Journal article |
| id | oxford-uuid:c61c6072-7703-432d-87c5-b20696d7327c |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T04:05:49Z |
| publishDate | 2010 |
| publisher | University of Chicago Press |
| record_format | dspace |
| spelling | oxford-uuid:c61c6072-7703-432d-87c5-b20696d7327c2022-03-27T06:35:54ZDynamic merger review. Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:c61c6072-7703-432d-87c5-b20696d7327cEnglishDepartment of Economics - ePrintsUniversity of Chicago Press2010Nocke, VWhinston, MWe analyze the optimal dynamic policy of an antitrust authority toward horizontal mergers when merger proposals are endogenous and occur over time. Approving a currently proposed merger may affect the profitability and welfare effects of potential future mergers, whose characteristics may not yet be known. We identify conditions under which discounted expected consumer surplus is maximized by using a completely myopic merger review policy that approves a merger if and only if it does not lower consumer surplus given the current market structure. We also discuss a number of extensions as well as factors that undermine the optimality of myopic merger review policies. |
| spellingShingle | Nocke, V Whinston, M Dynamic merger review. |
| title | Dynamic merger review.
|
| title_full | Dynamic merger review.
|
| title_fullStr | Dynamic merger review.
|
| title_full_unstemmed | Dynamic merger review.
|
| title_short | Dynamic merger review.
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| title_sort | dynamic merger review |
| work_keys_str_mv | AT nockev dynamicmergerreview AT whinstonm dynamicmergerreview |