Bilateral merger in a leadership structure

Tarun Kabiraj and Arijit Mukherjee

No 2001/04, Keele Department of Economics Discussion Papers (1995-2001) from Department of Economics, Keele University

Abstract: In an oligopoly industry of k firms (k > 2) with linear demand and identical (constant) average cost of production, a bilateral merger is never profitable when all firms choose their quantities simultaneously. In this paper we reexamine the issue when some firms have first-mover advantage. We find that in a leader-follower structure a bilateral merger is always profitable when a leader and a follower merge together and the merged firm behaves like a leader. But, a bilateral merger between leaders or between followers may not be privately profitable.

Keywords: Follower; Leader; Merger (search for similar items in EconPapers)
JEL-codes: L13 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2001-02
References: Add references at CitEc
Citations:

Published in Journal of Quantitative Economics, New Series, 1 (Old Series, (2001) 17): 82 - 88 (2003).

Downloads: (external link)
http://www.keele.ac.uk/depts/ec/wpapers/0104.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.keele.ac.uk/depts/ec/wpapers/0104.pdf [301 Moved Permanently]--> https://www.keele.ac.uk:443/depts/ec/wpapers/0104.pdf)

Related works:
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:kee:keeldp:2001/04

Ordering information: This working paper can be ordered from
Department of Economics, Keele University, Keele, Staffordshire ST5 5BG - United Kingdom
http://www.keele.ac.uk/depts/ec/cer/pubs_kerps.htm

Access Statistics for this paper

More papers in Keele Department of Economics Discussion Papers (1995-2001) from Department of Economics, Keele University Department of Economics, University of Keele, Keele, Staffordshire, ST5 5BG - United Kingdom. Contact information at EDIRC.
Bibliographic data for series maintained by Martin E. Diedrich ( this e-mail address is bad, please contact ).