How to Measure the Deterrence Effects of Merger Policy: Frequency or Composition?
Pedro P. Barros
Universidade Nova de Lisboa
Joseph A. Clougherty
University of Illinois at Urbana-Champaign; Centre for Economic Policy Research (CEPR)
University of Amsterdam; Tinbergen Institute
CEPR Discussion Paper No. DP7454
We show that the number of merger proposals (frequency-based deterrence) is a more appropriate indicator of underlying changes in merger policy than the relative anti-competitiveness of merger proposals (composition-based deterrence). This has strong implications for the empirical analysis of the deterrence effects of merger policy enforcement, and potential implications regarding how to reduce anti-competitive merger proposals.
Number of Pages in PDF File: 11
Keywords: antitrust, deterrence, merger policy
JEL Classification: K21, L40, L49
Date posted: October 7, 2009
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