Data-Driven Mergers

Alexandre de Cornière and Greg Taylor

No 24-1576, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We study mergers between firms operating in data-connected markets: the data generated as a byproduct of the activity on market A can be used by firms operating on market B. The effects of such a merger depend on whether data trade among independent firms is possible, and on whether data use benefits consumers or leads to more surplus extraction. When data increases product B’s quality, the merger benefits consumers on both markets if data cannot be traded absent the merger, and harms them otherwise. When data is used to extract consumer surplus on market B the merger increases consumer surplus on market A and reduces it on market B.

Date: 2024-09-19
New Economics Papers: this item is included in nep-com, nep-mic and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:129733

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