Efficiency Gains and Myopic Antitrust Authority in a Dynamic Merger Game

Massimo Motta (massimo.motta@upf.edu) and Helder Vasconcelos

No ECO2003/23, Economics Working Papers from European University Institute

Abstract: This paper models a sequential merger formation game with endogenous efficiency gains in which every merger has to be submitted for approval to the Antitrust Authority (AA). Two different types of AA are studied: first a myopic AA, which judges a given merger without considering that subsequent mergers may occur; and, second, a forward looking AA, which anticipates the ultimate market structure a given merger will lead to. By contrasting the decisions of these two types of AA, merger policy implications can be drawn. In particular, the efficiency offence argument does not find any justification under a forward looking AA.

Keywords: Endogenous mergers; Foresight, Efficiency offence (search for similar items in EconPapers)
JEL-codes: D43 L13 L41 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Efficiency gains and myopic antitrust authority in a dynamic merger game (2005)
Working Paper: Efficiency Gains and Myopic Antitrust Authority in a Dynamic Merger Game (2004)
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