Merger control in retail markets with national pricing

Tommy Gabrielsen, Bjørn Olav Johansen () and Odd Rune Straume
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Bjørn Olav Johansen: Department of Economics, University of Bergen

No 10/2022, NIPE Working Papers from NIPE - Universidade do Minho

Abstract: We analyze theoretically the efficiency of structural remedies in merger control in retail markets and show that this crucially depends on the retail chains´pricing policy. Whereas a retail merger can be perfectly remedied by divestiture of stores under local pricing, such remedies are not only less effective, but might even be counterproductive, if the chains set national prices. Paradoxically, such remedies might be even more counterproductive if the chains also compete locally along non-price dimensions such as quality. Our analysis suggests that antitrust authorities should be very cautious when reviewing structural remedies in retail markets with national pricing.

Keywords: Retail mergers; structural remedies; national pricing. (search for similar items in EconPapers)
JEL-codes: L11 L22 L41 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-com, nep-ind, nep-law and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:nip:nipewp:10/2022

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