Merger Policy in a Quantitative Model of International Trade

Holger Breinlich, Volker Nocke and Nicolas Schutz

The Economic Journal, 2020, vol. 130, issue 626, 393-421

Abstract: In a two-country international trade model with oligopolistic competition, we study the conditions on market structure and trade costs under which a merger policy designed to benefit domestic consumers is either too tough or too lenient, from the viewpoint of the foreign country. We calibrate the model to match industry-level data in the USA and Canada. Our results suggest that, at present levels of trade costs, merger policy is too tough in the vast majority of sectors. We also quantify the resulting externalities and study the impact of different regimes of co-ordinating merger policies at varying levels of trade costs.

Date: 2020
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Related works:
Working Paper: Merger Policy in a Quantitative Model of International Trade (2018)
Working Paper: Merger Policy in a Quantitative Model of International Trade (2016)
Working Paper: Merger Policy in a Quantitative Model of International Trade (2016)
Working Paper: Merger Policy in a Quantitative Model of International Trade (2015)
Working Paper: Merger Policy in a Quantitative Model of International Trade (2015)
Working Paper: Merger policy in a quantitative model of internationaltrade (2015)
Working Paper: Merger Policy in a Quantitative Model of International Trade (2015)
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