search query: @indexterm welfare / total: 396
reference: 43 / 396
| Author: | Gandhi, A. (et al.) |
| Title: | Post-merger product repositioning |
| Journal: | Journal of Industrial Economics
2008 : MAR, VOL 56:1 p. 49-67 |
| Index terms: | mergers prices consumers positioning welfare |
| Language: | eng |
| Abstract: | This paper analyzes the effects of mergers between firms competing by simultaneously choosing price and competition. Products combined by a merger are repositioned away from each other to reduce cannibalization, and non-merging substitutes are, in response, repositioned between the merged products. This repositioning greatly reduces the merged firm's incentive to raise prices and thus substantially mitigates the anticompetitive effects of the merger. Computation of, and selection among, equilibria is done with a novel technique known as the stochastic response dynamic, which doesn't require the computation of first-order conditions. |
SCIMA