Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5078759 | International Journal of Industrial Organization | 2008 | 8 Pages |
Abstract
We analyze horizontal mergers in a collusive environment by using an infinitely repeated game where (i) a subset of collusive firms is exogenously given and (ii) partially collusive arrangements are allowed for. We show that, in our model, there is no clear relation between the existence of mergers and full collusion at equilibrium. However, we demonstrate that the presence of mergers generally leads to a price increase. Also, we show that cartel firms have less incentives to merge than firms in a Cournot oligopoly, and that collusion increases fringe firms' incentives to merge.
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Economics and Econometrics
Authors
Marc Escrihuela-Villar,