An Empirical Analysis of Merger Enforcement under the 1992 Merger Guidelines

Abstract:     
This paper presents an analysis of merger enforcement at the Federal Trade Commission under the 1992 Merger Guidelines. Econometric analysis suggests that enforcement decisions are best predicted with the Herfindahl when the relevant theory is collusion and the number of significant rivals when the relevant theory is unilateral effects. As one would expect, hot documents, customer complaints, event evidence of competitive problems and ease of entry also impact enforcement. Efficiencies seem to affect the process through their effect on reducing serious customer complaints, while econometric estimation of sophisticated market models does not appear to impact the outcome of the merger review process. Finally, no evidence exists to suggest that the enforcement structure has changed during the 10 year period under review.

Number of Pages in PDF File: 43

Keywords: Merger guidelines, merger enforcement, Federal Trade Commission

JEL Classification: K21, L40

working papers series