MERGERS IN ASYMMETRIC STACKELBERG MARKETS

Ramón Faulí-Oller () and Marc Escrihuela-Villar ()
Additional contact information
Ramón Faulí-Oller: Universidad de Alicante

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: It is well known that the profitability of horizontal mergers with quantity competition is scarce. However, in an asymmetric Stackelberg market we obtain that some mergers are profitable. Our main result is that mergers among followers become profitable when the followers are inefficient enough. In this case, leaders reduce their output when followers merge and this reduction renders the merger profitable. This merger increases price and welfare is reduced.

Keywords: Mergers; Asymmetries; Stackelberg. (search for similar items in EconPapers)
JEL-codes: L13 L40 L41 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2007-05
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind and nep-mic
References: Add references at CitEc
Citations: View citations in EconPapers (9)

Published by Ivie

Downloads: (external link)
http://www.ivie.es/downloads/docs/wpasad/wpasad-2007-14.pdf Fisrt version / Primera version, 2007 (application/pdf)

Related works:
Journal Article: Mergers in asymmetric Stackelberg markets (2008)
Working Paper: Mergers in Asymmetric Stackelberg Markets (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ivi:wpasad:2007-14

Access Statistics for this paper

More papers in Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) Contact information at EDIRC.
Bibliographic data for series maintained by Departamento de Edición ().