Asymmetric Collusion and Merger Policy

Mattias Ganslandt (mattias.ganslandt@celec.eu), Lars Persson and Helder Vasconcelos

No 28, Working Papers from Portuguese Competition Authority

Abstract: In their merger control, EU and the US have considered symmetric size distribution (cost structure) of firms to be a factor potentially leading to collusion. We show that forbidding mergers leading to symmetric market structures can induce mergers leading to asymmetric market structures with higher risk of collusion, when firms face indivisible costs of collusion. In particular, we show that if the rule determining the collusive outcome has the property that the large (efficient) firm benefits sufficiently more from collusion when industry asymmetries increase, collusion can become more likely when firms are moderately asymmetric.

Keywords: Collusion; Cost Asymmetries; Merger Policy (search for similar items in EconPapers)
JEL-codes: D43 L41 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2007-10
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-mic and nep-reg
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.concorrencia.pt/download/WP28_mglphv-Asymmetric_Collusion.pdf First version, 2007 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.concorrencia.pt/download/WP28_mglphv-Asymmetric_Collusion.pdf [301 Moved Permanently]--> https://www.concorrencia.pt/download/WP28_mglphv-Asymmetric_Collusion.pdf)

Related works:
Working Paper: Asymmetric Collusion and Merger Policy (2007)
Working Paper: Asymmetric Collusion and Merger Policy (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pca:wpaper:28

Access Statistics for this paper

More papers in Working Papers from Portuguese Competition Authority Contact information at EDIRC.
Bibliographic data for series maintained by Duarte Brito (dmmcbrito@gmail.com).