Welfare-Reducing Mergers in Differentiated Oligopolies with Free Entry
Title | Welfare-Reducing Mergers in Differentiated Oligopolies with Free Entry PDF eBook |
Author | Nisvan Erkal |
Publisher | |
Pages | 0 |
Release | 2010 |
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Antitrust authorities regard the possibility of post-merger entry and merger-generated efficiencies as two factors that may counteract the negative effects of horizontal mergers. This article shows that in differentiated oligopolies with linear demand, all entry-inducing mergers harm consumer welfare. This is because if there is entry following a merger, it implies that the merger-generated efficiencies were not sufficiently large. Mergers which induce exit, owing to sufficiently high cost savings, always improve consumer welfare.
Welfare-Reducing Entry in a Differentiated Cournot Oligopoly Without Costs
Title | Welfare-Reducing Entry in a Differentiated Cournot Oligopoly Without Costs PDF eBook |
Author | Shohei Yoshida |
Publisher | |
Pages | 24 |
Release | 2017 |
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We revisit the relationships between competition and various market outcomes in a differentiated Cournot oligopoly. Consider an oligopolistic market with two differentiated varieties, where each firm sells one of the varieties. We show that social welfare and consumer surplus can decrease with the number of firms when the products of entrants and incumbents are homogeneous. Moreover, an entry of firm can increases prices and profits of firm producing the other variety. We provide a simple exposition of the conditions which determine the effect of an increase in the number of entrants on various market outcomes.
On Welfare Under Cournot and Bertrand Competition in Differentiated Oligopolies
Title | On Welfare Under Cournot and Bertrand Competition in Differentiated Oligopolies PDF eBook |
Author | Yu-Pei Judy Hsu |
Publisher | |
Pages | 0 |
Release | 2007 |
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Hackner (2000, Journal of Economic Theory 93, 233-239) shows that in a differentiated oligopoly with more than two firms, prices may be higher under Bertrand competition than under Cournot competition, implying that the classical result of Singh and Vives (1984, Rand Journal of Economics, 15, 546-554) that Bertrand prices are always lower than Cournot prices is sensitive to the duopoly assumption. Hackner (2000, Journal of Economic Theory, 93, 233-239), however, leaves unanswered the important question of whether welfare may be lower under price competition. This note shows that in Hackner's model both consumer surplus and total surplus are higher under price competition than under quantity competition, regardless of whether goods are substitutes or complements.
Welfare in a Differentiated Oligopoly with Free Entry
Title | Welfare in a Differentiated Oligopoly with Free Entry PDF eBook |
Author | Roberto Cellini |
Publisher | |
Pages | 9 |
Release | 1999 |
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Handbook of Merger Control and Environmental Policy
Title | Handbook of Merger Control and Environmental Policy PDF eBook |
Author | Luis Gautier |
Publisher | Springer Nature |
Pages | 262 |
Release | |
Genre | |
ISBN | 3031635493 |
The Antitrust Paradox
Title | The Antitrust Paradox PDF eBook |
Author | Robert Bork |
Publisher | |
Pages | 536 |
Release | 2021-02-22 |
Genre | |
ISBN | 9781736089712 |
The most important book on antitrust ever written. It shows how antitrust suits adversely affect the consumer by encouraging a costly form of protection for inefficient and uncompetitive small businesses.
Welfare Standards and Merger Analysis
Title | Welfare Standards and Merger Analysis PDF eBook |
Author | Ken Heyer |
Publisher | |
Pages | 44 |
Release | 2006 |
Genre | Antitrust law |
ISBN |