Endogenous Mergers and Collusion in Asymmetric Market Structures
Bibliographic Data
| ID | 9728198 |
|---|---|
| Authors | Mattias Ganslandt (Center for European Law and Economics (CELEC)), Lars Persson (0000-0002-7416-576X, Research Institute of Industrial Economics (IFN) and CEPR), Hélder Vasconcelos (0000-0002-2584-4352, Faculdade de Economia, Universidade do Porto and CEPR) |
| Year | 2012 |
| Volume | 79 |
| Issue | 316 |
| Pages | 766-791 |
| Publication date | 2012-10-01 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/j.1468-0335.2012.00937.x |
| OpenAlex | W2027187042 |
| Language | EN |
| Citations received | 3 |
| References cited | 21 |
Recent empirical evidence shows that cartels are often asymmetric, while cartel theory suggests that firm symmetry is conducive to collusion. Including an indivisible cost of cartelization, we show that medium asymmetric market structures are more conducive to collusion, since they balance the small firms' incentives to stay in the cartel against the need to cover the cartel leaders' indivisible cartelization cost. Using an endogenous merger model, we also show that forbidding mergers leading to symmetric market structures can induce mergers leading to asymmetric market structures with a higher risk of collusion. Current antisymmetry merger policy can thus be counterproductive
Antisymmetry · Business · Cartel · Collusion · Economics · Empirical evidence · Incentive · Industrial organization · Market power · Market structure · Merger control · Microeconomics · Corporate Finance and Governance · Digital Platforms and Economics · Finance · Merger and Competition Analysis
| Citations per year | 0.23 |
|---|---|
| Citation span | 2013 - 2021 (9) |
| Highly cited | No |