Win/Loss Data and Consumer Switching Costs: Measuring Diversion Ratios and the Impact of Mergers
Y. Jeff Qiu,
Masayuki Sawada and
Gloria Sheu
Journal of Industrial Economics, 2024, vol. 72, issue 1, 327-355
Abstract:
We propose an identification strategy for diversion based on win/loss data. First, we show that win/loss data from the merging firms and market shares in two periods for all firms are sufficient to identify the diversion ratios between the merging partners. Second, we show that win/loss data from the merging firms alone are sufficient for partial identification, and we construct a lower bound that provides a good approximation to the diversion ratio when switching costs are high. We demonstrate the performance of our method with numerical simulations and with an application to the Anthem/Cigna merger.
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://doi.org/10.1111/joie.12371
Related works:
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:bla:jindec:v:72:y:2024:i:1:p:327-355
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0022-1821
Access Statistics for this article
Journal of Industrial Economics is currently edited by Pierre Regibeau, Yeon-Koo Che, Kenneth Corts, Thomas Hubbard, Patrick Legros and Frank Verboven
More articles in Journal of Industrial Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery (contentdelivery@wiley.com).