WELFARE‐ENHANCING MERGERS UNDER PRODUCT DIFFERENTIATION

Tina Kao and Flavio Menezes

Manchester School, 2010, vol. 78, issue 4, 290-301

Abstract: In this paper we consider a model of duopoly with differentiated products to examine the welfare effects of a merger between two asymmetric firms. We find that, for quantity competition, the parameter range for welfare‐enhancing merger widens if the products are closer substitutes. On the other hand, mergers are never welfare enhancing in this setting when firms compete in prices.

Date: 2010
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Citations: View citations in EconPapers (10)

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https://doi.org/10.1111/j.1467-9957.2009.02145.x

Related works:
Working Paper: Welfare Enhancing Mergers Under Product Differentiation (2009)
Working Paper: Welfare Enhancing Mergers under Product Differentiation (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:bla:manchs:v:78:y:2010:i:4:p:290-301

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