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Merger Simulation in Competition Policy: A Survey

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  • Oliver Budzinski

    ()
    (Philipps-University Marburg)

  • Isabel Ruhmer

    ()
    (University of Mannheim)

Abstract

Advances in competition economics as well as in computational and empirical methods have offered the scope for the employment of merger simulation models in merger control procedures during the past almost 15 years. Merger simulation is, nevertheless, still a very young and innovative instrument of antitrust and, therefore, its ‘technical’ potential is far from being comprehensively exploited and teething problems in its practical use in the antitrust environment prevail. We provide a classification of state-of-the-art merger simulation models and review their previous employment in merger cases as well as the problems and limitations currently associated with their use in merger control. In summary, merger simulation models represent an important and valuable extension of the toolbox of merger policy. However, they do not qualify as a magic bullet and must be combined with other, more traditional instruments of competition policy in order to comprehensively unfold its beneficial effects.

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File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/07-2008_budzinski.pdf
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Bibliographic Info

Paper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 200807.

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Length: 39 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:mar:magkse:200807

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Keywords: merger simulation; merger control; antitrust; oligopoly theory; auction models; mergers & acquisitions;

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Citations

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Cited by:
  1. Christoph Engel, 2013. "Behavioral Law and Economics: Empirical Methods," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2013_01, Max Planck Institute for Research on Collective Goods.
  2. Stephen Martin, 2012. "Market Structure and Market Performance," Review of Industrial Organization, Springer, vol. 40(2), pages 87-108, March.
  3. Konings, Jozef & Roeger, Werner & Zhao, Liqiu, 2011. "Price-Cost Margins and Shares of Fixed Factors," CEPR Discussion Papers 8290, C.E.P.R. Discussion Papers.
  4. Farrell Joseph & Shapiro Carl, 2010. "Antitrust Evaluation of Horizontal Mergers: An Economic Alternative to Market Definition," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 10(1), pages 1-41, March.
  5. Pham, Vivienne & Prentice, David, 2010. "An empirical analysis of the counterfactual: a merger and divestiture in the Australian cigarette industry," MPRA Paper 26713, University Library of Munich, Germany.
  6. Lapo Filistrucchi & Tobias J. Klein, 2013. "Price Competition in Two-Sided Markets with Heterogeneous Consumers and Network Effects," Working Papers 13-20, NET Institute.
  7. Harbord, David & Hoernig, Steffen, 2010. "Welfare Analysis of Regulating Mobile Termination Rates in the UK (with an Application to the Orange/T-Mobile Merger)," MPRA Paper 21515, University Library of Munich, Germany.
  8. Budzinski, Oliver & Kuchinke, Björn A., 2012. "Deal or no deal? Consensual arrangements as an instrument of European competition policy," Ilmenau Economics Discussion Papers 76, Ilmenau University of Technology, Institute of Economics.
  9. Kamerbeek, S.P., 2009. "Merger Performance and Efficiencies in Horizontal Merger Policy in the US and the EU," MPRA Paper 18064, University Library of Munich, Germany.
  10. Budzinski, Oliver, 2012. "Empirische Ex-Post Evaluation von wettbewerbspolitischen Entscheidungen: Methodische Anmerkungen," Ilmenau Economics Discussion Papers 69, Ilmenau University of Technology, Institute of Economics.
  11. Oliver Budzinski, 2009. "Modern Industrial Economics and Competition Policy: Open Problems and Possible Limits," Working Papers 93/09, University of Southern Denmark, Department of Environmental and Business Economics.
  12. Claudio Agostini, 2012. "Economies of Scale and Merger Efficiencies: Empirical Evidence from the Chilean Pension Funds Market," Working Papers wp_027, Adolfo Ibáñez University, School of Government.
  13. Oliver Budzinski, 2010. "An Institutional Analysis of the Enforcement Problems in Merger Control," Working Papers 101/10, University of Southern Denmark, Department of Environmental and Business Economics.
  14. Vivienne Pham & David Prentice, 2013. "A Random Coefficients Logit Analysis of the Counterfactual: A Merger and Divestiture in the Australian Cigarette Industry," Working Papers 2013.04, School of Economics, La Trobe University.
  15. Budzinski, Oliver, 2012. "Impact evaluation of merger control decisions," Ilmenau Economics Discussion Papers 75, Ilmenau University of Technology, Institute of Economics.
  16. Oliver Budzinski, 2011. "Impact Evaluation of Merger Decisions," Working Papers 112/11, University of Southern Denmark, Department of Environmental and Business Economics.
  17. Juan Luis Jiménez & Jordi Perdiguero, 2012. "“Mergers and difference-in-difference estimator: why firms do not increase prices?”," IREA Working Papers 201205, University of Barcelona, Research Institute of Applied Economics, revised Feb 2012.
  18. Budzinski, Oliver, 2012. "Würde eine unabhängige europäische Wettbewerbsbehörde eine bessere Wettbewerbspolitik machen?," Ilmenau Economics Discussion Papers 78, Ilmenau University of Technology, Institute of Economics.

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