A Robust Test for Consumer Welfare Enhancing Mergers Among Sellers of Differentiated Products

Gregory Werden

Working Papers from U.S. Department of Justice - Antitrust Division

Abstract: Recently developed tools are used to predict the effects of differentiated products mergers, but they require the assumption of a particular functional form for industry demand, and any assumption is vulnerable to attack. This paper demonstrates that marginal cost reductions necessary to restore premerger prices can be calculated without making any assumption about demand, and it provides a robust and practical method for determining whether a particular merger enhances consumer welfare.

Keywords: CONSUMPTION; TESTS; PRODUCTS (search for similar items in EconPapers)
JEL-codes: D10 D12 D40 (search for similar items in EconPapers)
Pages: 5 pages
Date: 1996
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Citations: View citations in EconPapers (110)

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Journal Article: A Robust Test for Consumer Welfare Enhancing Mergers among Sellers of Differentiated Products (1996)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:usjuat:96-01

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