Merger Control on Two-Sided Markets: Is There Need for an Efficiency Defense?

28 Pages Posted: 10 Oct 2014

See all articles by Edmond Baranes

Edmond Baranes

Université Montpellier 1

Thomas Cortade

University of Montpellier

Andreea Cosnita-Langlais

Université Paris Ouest - Nanterre, La Défense - EconomiX

Date Written: September 30, 2014

Abstract

We study horizontal mergers on two-sided markets between horizontally differentiated platforms. We provide a theoretical analysis of the merger’s price effect based on the amount of cost savings it generates, the behavior of outsider platforms, and the size of cross-group network effects. We point out differences as compared with the standard, one-sided merger analysis, and also discuss the merger control policy implications.

Keywords: horizontal merger, two-sided markets, cost savings, merger control

JEL Classification: L41, D82, K21

Suggested Citation

Baranes, Edmond and Cortade, Thomas and Cosnita-Langlais, Andreea, Merger Control on Two-Sided Markets: Is There Need for an Efficiency Defense? (September 30, 2014). NET Institute Working Paper No. 14-12, Available at SSRN: https://ssrn.com/abstract=2506359 or http://dx.doi.org/10.2139/ssrn.2506359

Edmond Baranes (Contact Author)

Université Montpellier 1 ( email )

Avenue de la Mer Site Richter
163 Rue Auguste Broussonnet
34006 Montpellier Cedex 1, Cedex 2 34090
France

Thomas Cortade

University of Montpellier ( email )

Avenue de la Mer Site Richter
163 Rue Auguste Broussonnet
Montpellier, Cedex 2 34090
France

Andreea Cosnita-Langlais

Université Paris Ouest - Nanterre, La Défense - EconomiX ( email )

200 Avenue de la République
Nanterre cedex, Nanterre Cedex 92000
France

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