ABA Antitrust Section, Issues in Competition Law and Policy
15 Pages Posted: 15 Jan 2007 Last revised: 20 Nov 2012
Date Written: 2008
Horizontal mergers give rise to unilateral anticompetitive effects if they cause the merged firm to act less intensely competitive than the merging firms, while non-merging rivals do not alter their competitive strategies. This chapter describes the economic theory underlying unilateral competitive effects from mergers when prices are set through an auction or bargaining process. In the auction context, this chapter also describes the quantitative application of this theory in predicting the unilateral price effects of proposed mergers.
Keywords: mergers, auctions, bargaining
JEL Classification: L41, L13
Suggested Citation: Suggested Citation
Werden, Gregory J. and Froeb, Luke, Unilateral Competitive Effects of Horizontal Mergers Ii: Auctions and Bargaining (2008). ABA Antitrust Section, Issues in Competition Law and Policy. Available at SSRN: https://ssrn.com/abstract=956400