Market Power Absent Merger Review: Brewing in Perú
Ariel A. Casarin (),
Magdalena Cornejo () and
María Eugenia Delfino ()
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Ariel A. Casarin: Universidad Adolfo Ibáñez
Magdalena Cornejo: Universidad Torcuato Di Tella
María Eugenia Delfino: Universidad de los Andes
Review of Industrial Organization, 2020, vol. 56, issue 3, No 6, 535-556
Abstract We examine the extent of market power in the brewing market of Perú, where the absence of preventive merger review eased consolidation into a single industrial brewer. We use a standard oligopoly model and exploit both seasonality in demand and atypically large and frequent variations in the structure and level of excise taxes to identify variations in market power. Our results provide evidence of the ineffectiveness of competition policy as uncontested mergers resulted in a degree of market power that decreased only with the entry of new firms.
Keywords: Antitrust; Merger review; Market power; Brewing industry (search for similar items in EconPapers)
JEL-codes: D43 L41 K21 L66 (search for similar items in EconPapers)
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