Price-Concentration Analysis in Merger Cases with Differentiated Products

24 Pages Posted: 18 Dec 2010  

Walter Beckert

University of London - Economics, Mathematics and Statistics

Nicola Mazzarotto

affiliation not provided to SSRN

Multiple version iconThere are 2 versions of this paper

Date Written: 2010

Abstract

This paper considers the empirical assessment of the relationship between prices and number of firms in local markets in geographic or, more generally, characteristic space and its use as evidence in merger cases. It outlines a structural, semi-nonparametric econometric model of competition in such markets, examines its testable implications in terms of price-concentration relationships, and demonstrates that the model is non-parametrically identified. This general approach to price-concentration analysis in differentiated product markets is illustrated in a small-scale application to cinemas in the UK. The application highlights the main decision points faced by an authority when assessing the weight that can be attached to this type of analysis as evidence. --

Keywords: Differentiated products, local competition, non-parametric identification

JEL Classification: L11, C31

Suggested Citation

Beckert, Walter and Mazzarotto, Nicola, Price-Concentration Analysis in Merger Cases with Differentiated Products (2010). Economics: The Open-Access, Open-Assessment E-Journal, Vol. 4, 2010-16. Available at SSRN: https://ssrn.com/abstract=1726885 or http://dx.doi.org/10.5018/economics-ejournal.ja.2010-16

Walter Beckert (Contact Author)

University of London - Economics, Mathematics and Statistics ( email )

Malet Street
London, WC1E 7HX
United Kingdom

Nicola Mazzarotto

affiliation not provided to SSRN

No Address Available

Paper statistics

Downloads
54
Rank
257,997
Abstract Views
443