Merger Analysis in Two-Sided Markets: The Belgian Newspaper Industry

Patrick Cayseele () and Stijn Vanormelingen
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Patrick Cayseele: KU Leuven

Review of Industrial Organization, 2019, vol. 54, issue 3, No 3, 509-541

Abstract: Abstract This paper builds a structural model for both advertising and readers’ demand in the Belgian newspaper industry, taking into account cross network effects that exist between advertisers and newspaper readers We combine our parameter estimates with the publishers’ first-order conditions to simulate the impact of a merger. We find a limited impact of the merger on reader and advertiser welfare. The effect on welfare is easily offset by possible efficiency gains. We compare the simulation outcome with the actual outcomes and find—in line with the predictions—no clear aggregate effect of the merger. The responses of individual newspapers, however, differ from the simulation.

Keywords: Merger simulation; Two-sided markets; Newspapers; Demand estimation (search for similar items in EconPapers)
JEL-codes: C23 L11 L82 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (5)

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DOI: 10.1007/s11151-018-9650-z

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