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On the Effective Design of the Efficiency Defence

Author

Listed:
  • Andreea Cosnita

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Jean-Philippe Tropeano

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

Abstract

The efficiency defence was long delayed in the European merger control due to costly implementation issues. In this paper we argue that the upstream consequences of the efficiency defence should equally be considered, namely the improvement of the distribution of notified mergers through the incentives it provides towards more efficient mergers. First of all, we show that even if the Competition Authority may not tell apart the mergers that rightfully invoke the efficiency defence from those that do not, allowing such a procedure can lead to a lower post-merger price. Secondly, we study the impact of merger remedies on the incentives conveyed by the efficiency defence, and conclude on the optimal design of the efficiency defence procedure.

Suggested Citation

  • Andreea Cosnita & Jean-Philippe Tropeano, 2006. "On the Effective Design of the Efficiency Defence," Post-Print halshs-00113503, HAL.
    • Handle: RePEc:hal:journl:halshs-00113503
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00113503
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    References listed on IDEAS

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    1. Lars-Hendrik Röller & Johan Stennek & Frank Verboven, 2006. "Efficiency Gains from Mergers," Chapters, in: Fabienne IIzkovitz & Roderick Meiklejohn (ed.), European Merger Control, chapter 3, Edward Elgar Publishing.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    merger remedies; efficiency defence; Merger control; Contrôle des fusions; procédure d' «efficiency defence»; remèdes des fusions;
    All these keywords.

    JEL classification:

    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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