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Recapture ratios in merger analysis

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  • Moresi, Serge
  • Zenger, Hans

Abstract

Most quantitative tools for assessing competitive effects of mergers rely heavily on recapture ratios (also known as aggregate diversion ratios). Recapture ratios measure the proportion of customers switching away from a product that is captured by other products within the market rather than outside the market. We propose a simple approach for approximating recapture ratios which can be usefully applied in merger and competition cases.

Suggested Citation

  • Moresi, Serge & Zenger, Hans, 2018. "Recapture ratios in merger analysis," Economics Letters, Elsevier, vol. 170(C), pages 136-138.
    • Handle: RePEc:eee:ecolet:v:170:y:2018:i:c:p:136-138
    DOI: 10.1016/j.econlet.2018.06.014
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    References listed on IDEAS

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    1. Miller, Nathan H. & Remer, Marc & Ryan, Conor & Sheu, Gloria, 2017. "Upward pricing pressure as a predictor of merger price effects," International Journal of Industrial Organization, Elsevier, vol. 52(C), pages 216-247.
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    6. Hausman, Jerry & Moresi, Serge & Rainey, Mark, 2011. "Unilateral effects of mergers with general linear demand," Economics Letters, Elsevier, vol. 111(2), pages 119-121, May.
    7. Stanley M. Besen & Stephen D. Kletter & Serge X. Moresi & Steven C. Salop & John R. Woodbury, 2013. "An Economic Analysis Of The At&T-T-Mobile Usa Wireless Merger," Journal of Competition Law and Economics, Oxford University Press, vol. 9(1), pages 23-47.
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    Cited by:

    1. Tommaso Valletti & Hans Zenger, 2021. "Mergers with Differentiated Products: Where Do We Stand?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 58(1), pages 179-212, February.
    2. Marta Wosińska & David Givens & Yan Lau & Doug S. Smith & Christopher Taylor & Benjamin Wallace, 2021. "Economics at the FTC: Multi-level Marketing and a Coal Joint Venture," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 59(4), pages 629-650, December.

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    More about this item

    Keywords

    Diversion ratios; Competitive effects of mergers;

    JEL classification:

    • L4 - Industrial Organization - - Antitrust Issues and Policies

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