2000-04-25Buch DOI: 10.18452/3349
Profitable horizontal mergers
A market structure–oriented view
Konrad, Kai A.
We propose a model in which mergers exert a more pronounced effect on the structure of a market than simply reducing the number of competitors. We show that this may render horizontal mergers profitable and welfare–improving even if costs are linear. The results help to reconcile theory with various empirical findings on mergers.
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