Working Paper: CEPR ID: DP15066
Authors: Tommaso Valletti; Hans Zenger
Abstract: On the occasion of the 10th anniversary of the 2010 U.S. Horizontal Merger Guidelines, this article provides an overview of the state of economic analysis of unilateral effects in mergers with differentiated products. Drawing on our experience with merger enforcement in Europe, we discuss both static and dynamic competition, with a special emphasis on the calibration of competitive effects. We also discuss the role of market shares and structural presumptions in differentiated product markets.
Keywords: mergers; differentiated products; unilateral effects
JEL Codes: L11; L13; L40; L41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| mergers (G34) | reduced competition (L19) |
| higher diversion ratios (L99) | significant price increases post-merger (G34) |
| UPP (R19) | competitive outcomes (L13) |
| mergers (G34) | reduced innovation (O39) |
| internalization of negative externalities (D62) | reduced R&D efforts (O39) |