Abstract

http://ssrn.com/abstract=2427345
 
 

References (5)



 
 

Citations (1)



 


 



Anti-Competitive Effects of Common Ownership


José Azar


University of Navarra, IESE Business School

Martin C. Schmalz


University of Michigan, Stephen M. Ross School of Business

Isabel Tecu


Charles River Associates (CRA)

July 5, 2016

Ross School of Business Paper No. 1235

Abstract:     
Many natural competitors are jointly held by a small set of large diversified institutional investors. In the US airline industry, taking common ownership into account implies increases in market concentration that are 10 times larger than what is “presumed likely to enhance market power” by antitrust authorities. We use within-route variation over time to identify a positive effect of common ownership on ticket prices. A panel-IV strategy that exploits BlackRock's acquisition of Barclays Global Investors confirms these results. We conclude that a hidden social cost -- reduced product market competition -- accompanies the private benefits of diversification and good governance.

Number of Pages in PDF File: 61

Keywords: Competition, Ownership, Diversification, Pricing, Antitrust, Governance, Product Market

JEL Classification: L41, L10, G34


Open PDF in Browser Download This Paper

Date posted: April 22, 2014 ; Last revised: August 8, 2016

Suggested Citation

Azar, José and Schmalz, Martin C. and Tecu, Isabel, Anti-Competitive Effects of Common Ownership (July 5, 2016). Ross School of Business Paper No. 1235. Available at SSRN: http://ssrn.com/abstract=2427345 or http://dx.doi.org/10.2139/ssrn.2427345

Contact Information

José Azar
University of Navarra, IESE Business School ( email )
Avenida Pearson 21
Barcelona, 08034
Spain
Martin C. Schmalz (Contact Author)
University of Michigan, Stephen M. Ross School of Business ( email )
701 Tappan St
R5456
Ann Arbor, MI 48109-1234
United States
7347630304 (Phone)
HOME PAGE: http://https://sites.google.com/site/martincschmalz/
Isabel Tecu
Charles River Associates (CRA) ( email )
1201 F. St. NW
Ste. 700
Washington, DC 20004
United States
Feedback to SSRN


Paper statistics
Abstract Views: 19,477
Downloads: 4,251
Download Rank: 1,307
References:  5
Citations:  1

© 2016 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollobot1 in 0.297 seconds