Bargaining over Remedies in Merger Regulation

Bruce Lyons and Andrei Medvedev
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Bruce Lyons: Centre for Competition Policy and School of Economics, University of East Anglia

No 2007-03, Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) from Centre for Competition Policy, University of East Anglia, Norwich, UK.

Abstract: This paper provides a first attempt to understand how outcomes are determined by the standard institutions of merger control. In particular, we focus on the internationally standard 2-phase investigation structure and remedy negotiations of the form practiced by the EC. We find that there are inherent biases in remedy outcomes, and identifiable circumstances where offers will be excessive and where they will be deficient. In particular, we find clear circumstances in which firms offer excessive remedies, which goes against a possible intuition that firms should expect to extract an information rent for possessing superior information about competition in the market.

Keywords: Merger regulation; merger remedies; competition policy; bargaining (search for similar items in EconPapers)
JEL-codes: K21 L41 L51 (search for similar items in EconPapers)
Date: 2007-02-01
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Citations: View citations in EconPapers (12)

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Working Paper: Bargaining over Remedies in Merger Regulation (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:uea:ueaccp:2007_03

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