They Played the Merger Game: A Retrospective Analysis in the UK Videogames Market

Luca Aguzzoni, Elena Argentesi (), Paolo Buccirossi, Lorenzo Ciari, Tomaso Duso, Massimo Tognoni and Cristiana Vitale

No 1330, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: We study the effect of a merger in a dynamic high-technology industry-the videogame market- which is characterized by frequent introduction of new products. To assess the impact of the merger between two large specialist retailers in the UK, we perform a difference-in-differences analysis comparing the price evolution of the merging parties to that of their 7 major competitors on an original sample of 196 videogames belonging to six different consoles. The results of our econometric analyses suggest that there has been a reduction in the general level of prices of both new and pre-owned games after the merger. This decline has been more marked for the merging parties, which suggests that the merger between Game and Gamestation did not lead to a substantial lessening of competition; rather it is consistent with the existence of efficiency gains.

Keywords: Mergers; ex-post evaluation; videogames market; retail sector (search for similar items in EconPapers)
JEL-codes: D22 K21 L24 L44 O32 (search for similar items in EconPapers)
Pages: 42 p.
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: They Played the Merger Game: A Retrospective Analysis in the UK Videogames Market (2013)
Working Paper: They played the merger game: A retrospective analysis in the UK videogames market (2013)
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