The Farrell and Shapiro condition revisited
AbstractThe purpose of this paper is to study the consequences of using the Farrell and Shapiro (1990) sufficient condition for merger approval to sectors in which a downstream horizontal merger may also affect upstream firms. As will be shown below, in some circumstances the sign of the relevant external effect can no longer be established by considering the merger as a sequence of in finitesimal mergers, each corresponding to a marginal change in output.
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Bibliographic InfoPaper provided by Universidade Nova de Lisboa, IET/CESNOVA-Research on Enterprise and Work Innovation, Faculty of Science and Technology in its series IET Working Papers Series with number 01/2007.
Length: 15 pages
Date of creation: Dec 2007
Date of revision:
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- Pita Barros, Pedro Luis, 1997. "Approval Rules for Sequential Horizontal Mergers," CEPR Discussion Papers 1764, C.E.P.R. Discussion Papers.
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- al-Nowaihi, A. & Levine, P. L., 1985. "The stability of the cournot oligopoly model: A reassessment," Journal of Economic Theory, Elsevier, vol. 35(2), pages 307-321, August.
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