The Price Effects of a Large Merger of Manufacturers: A Case Study of Maytag-Whirlpool

45 Pages Posted: 19 Dec 2011

See all articles by Matthew Weinberg

Matthew Weinberg

The Ohio State University, Department of Economics

Orley Ashenfelter

Princeton University - Industrial Relations Section; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Daniel S. Hosken

Government of the United States of America - Federal Trade Commission

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Date Written: December, 18 2011

Abstract

Many experts speculate that U.S. antitrust policy towards horizontal mergers has been too lenient. We estimate the price effects of Whirlpool’s acquisition of Maytag to provide new evidence on this debate. We compare price changes in appliance markets most affected by the merger to markets where concentration changed much less or not at all. We estimate price increases for dishwashers and relatively large price increases for clothes dryers, but no price effects for refrigerators or clothes washers. The combined firm’s market share fell across all four affected categories and the number of distinct appliance products fell.

Keywords: antitrust, mergers

JEL Classification: L00, L41, L68, K00, K21

Suggested Citation

Weinberg, Matthew and Ashenfelter, Orley C. and Hosken, Daniel S., The Price Effects of a Large Merger of Manufacturers: A Case Study of Maytag-Whirlpool (December, 18 2011). Available at SSRN: https://ssrn.com/abstract=1974311 or http://dx.doi.org/10.2139/ssrn.1974311

Matthew Weinberg (Contact Author)

The Ohio State University, Department of Economics ( email )

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Orley C. Ashenfelter

Princeton University - Industrial Relations Section ( email )

Princeton, NJ 08544-2098
United States
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National Bureau of Economic Research (NBER)

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IZA Institute of Labor Economics

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Bonn, D-53072
Germany

Daniel S. Hosken

Government of the United States of America - Federal Trade Commission ( email )

600 Pennsylvania Ave., NW
Washington, DC 20580
United States

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