*I would like to thank Philippe Choné, Philippe Février, Bruno Jullien, Laurent Linnemer, Robin Mason, Patrick Rey and participants at the 2006 ASSET Meeting (Lisbon) and the 2008 EARIE Conference (Toulouse) for helpful discussions and comments. I am also grateful to the Editor and two anonymous referees for their comments.
HORIZONTAL MERGERS, STRUCTURAL REMEDIES, AND CONSUMER WELFARE IN A COURNOT OLIGOPOLY WITH ASSETS*
Article first published online: 24 DEC 2010
© 2010 The Author. The Journal of Industrial Economics © 2010 Blackwell Publishing Ltd. and the Editorial Board of The Journal of Industrial Economics
The Journal of Industrial Economics
Volume 58, Issue 4, pages 723–741, December 2010
How to Cite
VERGÉ, T. (2010), HORIZONTAL MERGERS, STRUCTURAL REMEDIES, AND CONSUMER WELFARE IN A COURNOT OLIGOPOLY WITH ASSETS. The Journal of Industrial Economics, 58: 723–741. doi: 10.1111/j.1467-6451.2010.00432.x
- Issue published online: 24 DEC 2010
- Article first published online: 24 DEC 2010
Competition authorities sometimes require that firms divest some of their assets to rivals in order to allow a merger to take place. This paper extends the results of Farrell and Shapiro [1990a] and shows that, in the absence of technological synergies, a merger is highly unlikely to benefit consumers, even if it is subjected to appropriate structural remedies. For instance, a merger may ultimately lead to a lower price only if at least two different firms acquire the divested assets, and if the merging parties had relatively important pre-merger market shares.