The Anticompetitive Effect of Passive Investment

John M. Olin Center for Law, Economics, and Business, Harvard Law School, Discussion Paper No. 189

Posted: 16 Dec 1996

See all articles by David Gilo

David Gilo

Tel Aviv University - Buchmann Faculty of Law

Date Written: July 1996

Abstract

The leading antitrust cases provide a de facto exemption for a firm passively investing in its competitor's stock. In contrast, the article presents an economic analysis which shows that even totally passive investments by a firm in its competitor's stock may substantially lessen competition. Accordingly, the article proposes a reconsideration of the current antitrust treatment of such passive investments.

JEL Classification: K21, L41

Suggested Citation

Gilo, David, The Anticompetitive Effect of Passive Investment (July 1996). John M. Olin Center for Law, Economics, and Business, Harvard Law School, Discussion Paper No. 189. Available at SSRN: https://ssrn.com/abstract=10247

David Gilo (Contact Author)

Tel Aviv University - Buchmann Faculty of Law ( email )

Ramat Aviv
Tel Aviv 69978, IL
Israel
+972-3-6406299 (Phone)

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