An Equilibrium Approach to International Merger Policy
13 Pages Posted: 31 Oct 2008
Date Written: September 2005
Abstract
treat international merger policy as a repeated veto game. I show that there exists a unique efficient equilibrium within a particular class of trigger strategy equilibria. I then consider a series of comparative statics and extensions: (a) if for some exogenous reason one of the countries becomes more lenient towardsmergers, than the other country becomes more lenient as well; (b) merger remedies increase the probability that a merger is approved and increase total welfare; (c) the effects of a merger wave are magnified by the equilibrium approval policy.
Keywords: Merger policy, Repeated games
Suggested Citation: Suggested Citation
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