Negotiating remedies : revealing the merger efficiency gains
AbstractThis paper contributes to the economic analysis of merger control by taking into account the efficiency gains for the design of structural merger remedies when the competition authorities do not observe the magnitude of efficiency gains. We show that whenever divestitures are necessary, the Competition Authority will need to extract from the merging partners their private information on the merger’s efficiency gains. For this we propose a revelation mechanism combining divestitures with two additional tools, the regulation of the divestitures sale price and a merger fee. We show that an optimal combination of both instruments is effective: the most efficient merged firms are claimed to pay a merger fee while the less efficient divest asets at an upwards distorted sale price.
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Bibliographic InfoPaper provided by Grenoble Applied Economics Laboratory (GAEL) in its series Working Papers with number 200803.
Date of creation: 2008
Date of revision:
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More information through EDIRC
MERGER CONTROL; STRUCTURAL MERGER; REMEDIES; ASYMETRIC INFORMATION;
Other versions of this item:
- Cosnita, Andreea & Tropeano, Jean-Philippe, 2009. "Negotiating remedies: Revealing the merger efficiency gains," International Journal of Industrial Organization, Elsevier, vol. 27(2), pages 188-196, March.
- Andrea Cosnita & Jean-Philippe Tropeano, 2005. "Negotiating remedies : revealing the merger efficiency gains," Cahiers de la Maison des Sciences Economiques v05047, Université Panthéon-Sorbonne (Paris 1), revised Apr 2006.
- Andreea Cosnita & Jean-Philippe Tropeano, 2005. "Negotiating remedies : revealing the merger efficiency gains," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00194906, HAL.
- L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-21 (All new papers)
- NEP-BEC-2008-10-21 (Business Economics)
- NEP-COM-2008-10-21 (Industrial Competition)
- NEP-CTA-2008-10-21 (Contract Theory & Applications)
- NEP-LAW-2008-10-21 (Law & Economics)
- NEP-REG-2008-10-21 (Regulation)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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