15 Pages Posted: 4 Apr 2012 Last revised: 24 Aug 2013
Date Written: January 14, 2013
We propose a simple method for predicting price effects from mergers between branded retail chains competing in many local markets. When past mergers created markets with the same number of brands but different numbers of brand owners, price data at a single point in time exhibit between-market variation much like the variation over time from mergers. We construct an estimator isolating this between-market variation and use it to predict price effects from mergers in the car rental industry.
Keywords: horizontal mergers, retailing, rental car industry
JEL Classification: L11, L40, L91
Suggested Citation: Suggested Citation
Doane, Michael J. and Froeb, Luke and Werden, Gregory J. and Zimmer, David M., Predicting Price Effects from Retail Mergers (January 14, 2013). Vanderbilt Owen Graduate School of Management Research Paper No. 2034464. Available at SSRN: https://ssrn.com/abstract=2034464 or http://dx.doi.org/10.2139/ssrn.2034464
By Louis Kaplow