Posted by Social Science Research Network
Horizontal Mergers, Prices, and Productivity Robert B. Kulick (University of Maryland)
Abstract: Despite being an active area of economic research for decades, many fundamental questions about horizontal mergers remain unanswered. In particular, the extent to which horizontal mergers cause price increases by enhancing market power remains subject to intense debate and the nature of the interaction between the price effects and productivity effects of horizontal mergers is not well understood. We address a number of the current literature’s limitations by taking advantage of the rich microeconomic data collected for plants in the ready-mix concrete industry as part of the Census of Manufacturers (CM). Because of the expansive coverage of the industry offered by the CM, we are able to draw conclusions about horizontal mergers based on a broad sample of mergers, while making use of pricing, quantity, and productivity data that is rarely available in the context of horizontal merger research. We find that over the sample period horizontal mergers are responsible for simultaneously increasing both prices and productivity and that both the price and productivity increases are driven by mergers occurring after the promulgation of the 1982 Merger Guidelines.
Featured News
Justice Department Moves to End NCAA Transfer Rule
May 30, 2024 by
CPI
Kenya’s Competition Authority Proposes Tougher Regulations on Big Tech
May 30, 2024 by
CPI
KKR Secures EU Antitrust Approval for $24 Billion Acquisition of Telecom Italia’s Fixed-Line Network
May 30, 2024 by
CPI
European Court Sides with Tech Giants in Italian Regulatory Dispute
May 30, 2024 by
CPI
US Steel and Nippon Steel Secure International Approvals for $14.9B Merger
May 30, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Merger Guidelines Retrospective
May 21, 2024 by
CPI
Mergers of Complements
May 21, 2024 by
CPI
Personality Traits, Private Equity, and Merger Analysis
May 21, 2024 by
CPI
The 2023 Merger Guidelines: Lessons in the Importance of Incipiency, Modern Economics, and Monopsony
May 21, 2024 by
CPI
The 2023 Merger Guidelines: Sharpening Merger Analysis
May 21, 2024 by
CPI