Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare?

Andreea Cosnita-Langlais and Lars Sørgard

No 7/2014, Discussion Paper Series in Economics from Norwegian School of Economics, Department of Economics

Abstract: This paper deals with the enforcement of merger policy, and aims to study how merger emedies affect the deterrence accomplished by controlling mergers. We determine the optimal frequency of investigations launched by the agency, and identify situations where the introduction of remedies can lead to a lower welfare. We find that the potential for remedies can make it less likely that the worst mergers are deterred. Even if the worst mergers are deterred, the potential for remedies can lead to more mergers with a negative impact to be proposed, and eventually to more decision errors by the antitrust authorities.

Keywords: Merger control; merger remedies; enforcement; deterrence. (search for similar items in EconPapers)
JEL-codes: K21 L41 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2014-03-25
New Economics Papers: this item is included in nep-com, nep-ind and nep-law
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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http://brage.bibsys.no/xmlui/bitstream/handle/11250/194525/1/SAM0714.pdf (application/pdf)

Related works:
Journal Article: Enforcement and Deterrence in Merger Control: The Case of Merger Remedies (2018)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2018)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2014)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2014)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2014)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2014)
Working Paper: Enforcement vs Deterrence in Merger Control: Can Remedies Lead to Lower Welfare? (2013)
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