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A Retrospective Merger Analysis In The U.K. Videogame Market

Author

Listed:
  • Luca Aguzzoni
  • Elena Argentesi
  • Paolo Buccirossi
  • Lorenzo Ciari
  • Tomaso Duso
  • Massimo Tognoni
  • Cristiana Vitale

Abstract

We study the effect of a merger in a dynamic high-technology industry—the videogame market—which is characterized by the frequent introduction of new products. To assess the impact of the merger between two large specialist retailers in the United Kingdom—Game Group PLC and Games Station Limited—we perform a difference-in-differences analysis comparing the price evolution of the merging parties with that of their 7 major competitors on an original sample of 196 videogames belonging to 6 different consoles. The results of our econometric analyses suggest that there has been a reduction in the general level of prices of both new and pre-owned games after the merger. This decline has been more marked for the merging parties, which suggests that the merger between Game Group PLC and Games Station Limited did not lead to a substantial lessening of competition; rather, it is consistent with the existence of efficiency gains.

Suggested Citation

  • Luca Aguzzoni & Elena Argentesi & Paolo Buccirossi & Lorenzo Ciari & Tomaso Duso & Massimo Tognoni & Cristiana Vitale, 2014. "A Retrospective Merger Analysis In The U.K. Videogame Market," Journal of Competition Law and Economics, Oxford University Press, vol. 10(4), pages 933-958.
    • Handle: RePEc:oup:jcomle:v:10:y:2014:i:4:p:933-958.
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    File URL: http://hdl.handle.net/10.1093/joclec/nhu011
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    Citations

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    Cited by:

    1. Charpin, Ariane & Piechucka, Joanna, 2021. "Merger efficiency gains: Evidence from a large transport merger in france," International Journal of Industrial Organization, Elsevier, vol. 77(C).
    2. Luca Aguzzoni & Elena Argentesi & Lorenzo Ciari & Tomaso Duso & Massimo Tognoni, 2016. "Ex post Merger Evaluation in the U.K. Retail Market for Books," Journal of Industrial Economics, Wiley Blackwell, vol. 64(1), pages 170-200, March.
    3. Ariane Charpin & Joanna Piechucka, 2020. "Merger Efficiency Gains: Evidence from a Large Transport Merger in France," Discussion Papers of DIW Berlin 1843, DIW Berlin, German Institute for Economic Research.
    4. Piñeiro-Chousa, Juan & López-Cabarcos, M. Ángeles & Pérez-Pico, Ada M. & Caby, Jérôme, 2023. "The influence of Twitch and sustainability on the stock returns of video game companies: Before and after COVID-19," Journal of Business Research, Elsevier, vol. 157(C).

    More about this item

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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