Cost Efficiencies And Upward Pricing Pressure

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Cost Efficiencies and Upward Pricing Pressure

Author : Jessica Dutra
Publisher :
ISBN 13 :
Total Pages : 45 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis Cost Efficiencies and Upward Pricing Pressure by : Jessica Dutra

Download or read book Cost Efficiencies and Upward Pricing Pressure written by Jessica Dutra and published by . This book was released on 2019 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the accuracy of UPP as a tool in antitrust analysis when there are cost efficiencies from a horizontal merger. We include model-based, merger-specific cost efficiencies in a tractable manner and extend the standard UPP formulation to account for these efficiencies. The efficacy of the new UPP formulations is analyzed using Monte Carlo simulation of 40,000 mergers (8 scenarios, 5,000 mergers in each scenario). We find that the new UPP formulations yield substantial gains in prediction of post-merger prices, as compared to existing practice, and there are substantial gains in merger screening accuracy as well. Moreover, the new UPP formulations outperform the standard UPP formulation at higher thresholds for all the standard cases in the paper. The results support the inclusion of model-based cost efficiencies in the standard UPP formulation for more accurate antitrust decision-making.

Antitrust Analysis with Upward Pricing Pressure and Cost Efficiencies

Author : Jéssica Dutra
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (118 download)

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Book Synopsis Antitrust Analysis with Upward Pricing Pressure and Cost Efficiencies by : Jéssica Dutra

Download or read book Antitrust Analysis with Upward Pricing Pressure and Cost Efficiencies written by Jéssica Dutra and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Upward Pricing Pressure

Author : Adriaan Ten Kate
Publisher :
ISBN 13 :
Total Pages : 16 pages
Book Rating : 4.:/5 (13 download)

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Book Synopsis Upward Pricing Pressure by : Adriaan Ten Kate

Download or read book Upward Pricing Pressure written by Adriaan Ten Kate and published by . This book was released on 2013 with total page 16 pages. Available in PDF, EPUB and Kindle. Book excerpt: Upward pricing pressure has recently become an important analytical tool in horizontal-merger assessment, where it is taken as a measure for the incentives of the merged firm to raise prices. I propose a comprehensive measure for pricing pressure, applicable to any off-equilibrium situation, regardless of whether the departure from equilibrium is due to a merger, a cost change, a change in strategic interaction or just to a suboptimal move away from the equilibrium. For Bertrand competition between single-product firms my measure coincides with the traditional measure for upward pricing pressure. For multiproduct firms it is different from other generalizations to that case.

Upward Pricing Pressure in Oligopoly With Competitive Fringe

Author : Marcelo Henrique Shinkoda
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Upward Pricing Pressure in Oligopoly With Competitive Fringe by : Marcelo Henrique Shinkoda

Download or read book Upward Pricing Pressure in Oligopoly With Competitive Fringe written by Marcelo Henrique Shinkoda and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Farrell and Shapiro (F&S, 2010) proposed an Upward Pricing Pressure (UPP) approach to merger screening between two symmetrical firms. According to them, this UPP approach is more practical than concentration-based methods. However, the UPP fails because it does not incorporate all the theoretical effects which set the price. This article intends to close two specific gaps in the UPP. First an entire industry's case, which has a set of firms with asymmetric costs. Mathiesen et al. (2012) show that UPP screening could present a false-positives in asymmetric cases. In this sense, the present study includes a more efficient competitive fringe in the feedback effects that adjusts the pricing pressure effects. Second, as competitive fringe firms are price takers, demand's lack of representativeness is addressed. The study shows that in the model presented by F&S, the elasticity of demand is equal to one. However, in a market where prices tend to be higher than the equilibrium price, firms tend to operate in the elastic part of the demand curve. Thus, our results show that the UPP model with competitive fringe is Pareto efficient and subgame perfect Nash Equilibrium. Finally, after filling both gaps, the validity of the relevant-market term in industrial organization is discussed.

Merger Screens

Author : Elizabeth M. Bailey
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Merger Screens by : Elizabeth M. Bailey

Download or read book Merger Screens written by Elizabeth M. Bailey and published by . This book was released on 2010 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The US Department of Justice and Federal Trade Commission receive notification regarding thousands of mergers per year, and must identify, from the entire set of mergers, those that require further investigation. Merger screens are critical to efficient and effective merger enforcement policy, but traditional market share-based screens are often ineffective. An alternative approach is based on the concept of "upward pricing pressure," or UPP, which is a measure of the strength of the merged firm's incentive to increase price above pre-merger levels. In this article, we examine whether UPP would provide a useful screening device that the Agencies could use during the initial waiting period to decide whether a Second Request should be issued. We begin our analysis by providing an alternative derivation of UPP and show that UPP flows from the familiar logic of unilateral effects. We then discuss why reliable estimates of the three key inputs to UPP -- diversion ratios, gross profit margins, and efficiencies -- are unlikely to be available during the initial waiting period, thereby limiting the extent to which UPP can be a useful screen in the first thirty days.

The Enhanced Upward Pressure on Price Screen

Author : Malcolm B. Coate
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis The Enhanced Upward Pressure on Price Screen by : Malcolm B. Coate

Download or read book The Enhanced Upward Pressure on Price Screen written by Malcolm B. Coate and published by . This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Farrell and Shapiro's Upward Pressure on Price (UPP) structure is advanced as a technique to screen mergers in differentiated product markets. Lacking an ability to link their analysis with experiences from relevant markets, Farrell and Shapiro propose to assume substantial efficiencies, and conclude that any positive upward pressure on price is sufficient to trigger potential concerns. This structure creates problems: the refusal to tolerate any positive UPP leads the screen to find concerns with a broad collection of mergers and an assumption of high efficiencies means the screen is unable to identify concerns for certain mergers in low price-cost margin businesses. If minor changes are made in the UPP formula and the UPP effect is adjusted for market share, it is possible to define revised UPP-based models. One of the models can be shown to be compatible with historical FTC experience, given an assumed toleration of 2-3 percent upward pressure on price. Further research could improve the parameterization of an UPP-related screen and generate an even more reliable index. In some form, UPP analysis may succeed at defining the structural index for certain unilateral effects mergers.

Demand Side Merger Efficiencies

Author : David Reitman
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Demand Side Merger Efficiencies by : David Reitman

Download or read book Demand Side Merger Efficiencies written by David Reitman and published by . This book was released on 2010 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Mergers can generate demand side efficiencies that benefit customers in a number of ways, including procurement savings, transaction efficiencies, and quality improvements. We show that per-unit demand side efficiencies and marginal cost efficiencies of the same magnitude have an equivalent impact on the post-merger market in terms of output and welfare. Consequently, there is no reason to distinguish between marginal cost savings and demand side per-unit efficiencies when evaluating the impact of a merger. We demonstrate how various techniques for evaluating the impact of mergers - compensating marginal cost reductions, upward pricing pressure, and merger simulation - can be readily adapted to incorporate demand side as well as supply side efficiencies.

Do Merger Efficiencies Always Mitigate Price Increases?.

Author :
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)

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Book Synopsis Do Merger Efficiencies Always Mitigate Price Increases?. by :

Download or read book Do Merger Efficiencies Always Mitigate Price Increases?. written by and published by . This book was released on 2017 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In a Cournot model with differentiated products, we demonstrate that merger efficiencies in the form of lower marginal costs for the merging firms (the insiders) lead to higher postmerger prices under certain conditions. Specifically, when the degree of substitutability is low between the products offered by the two insiders but high between those by an insider and an outsider, increased merger efficiencies may exert upward rather than downward pressure on the prices of the merging firms. Our results suggest that in cases where firms engage in quantity competition, antitrust authorities should not presume that merger efficiencies will necessarily mitigate the anticompetitive effects of the merger. Prices can go up because of large efficiencies.

Do Merger Efficiencies Always Mitigate Price Increases?

Author : Zhiqi Chen
Publisher :
ISBN 13 :
Total Pages : 30 pages
Book Rating : 4.:/5 (978 download)

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Book Synopsis Do Merger Efficiencies Always Mitigate Price Increases? by : Zhiqi Chen

Download or read book Do Merger Efficiencies Always Mitigate Price Increases? written by Zhiqi Chen and published by . This book was released on 2017 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Modern Industrial Organization

Author : Dennis W. Carlton
Publisher : Addison Wesley
ISBN 13 :
Total Pages : 808 pages
Book Rating : 4.F/5 ( download)

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Book Synopsis Modern Industrial Organization by : Dennis W. Carlton

Download or read book Modern Industrial Organization written by Dennis W. Carlton and published by Addison Wesley. This book was released on 2000 with total page 808 pages. Available in PDF, EPUB and Kindle. Book excerpt: This text offers modern coverage of modern industrial organizations, including strategic behaviour and game theory. It uses a unified structure to analyse theories and empirical evidence about the organization of firms and indutries.

Handbook of Antitrust Economics

Author : Paolo Buccirossi
Publisher :
ISBN 13 :
Total Pages : 716 pages
Book Rating : 4.3/5 (91 download)

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Book Synopsis Handbook of Antitrust Economics by : Paolo Buccirossi

Download or read book Handbook of Antitrust Economics written by Paolo Buccirossi and published by . This book was released on 2008-03-21 with total page 716 pages. Available in PDF, EPUB and Kindle. Book excerpt: Experts examine the application of economic theory to antitrust issues in both the United States and Europe, discussing mergers, agreements, abuses of dominance, and the impact of market features. Over the past twenty years, economic theory has begun to play a central role in antitrust matters. In earlier days, the application of antitrust rules was viewed almost entirely in formal terms; now it is widely accepted that the proper interpretation of these rules requires an understanding of how markets work and how firms can alter their efficient functioning. The Handbook of Antitrust Economics offers scholars, students, administrators, courts, companies, and lawyers the economist's view of the subject, describing the application of newly developed theoretical models and improved empirical methods to antitrust and competition law in both the United States and the European Union. (The book uses the U.S. term “antitrust law” and the European “competition law” interchangeably, emphasizing the commonalities between the two jurisdictions.) After a general discussion of the use of empirical methods in antitrust cases, the Handbook covers mergers, agreements, abuses of dominance (or unilateral conducts), and market features that affect the way firms compete. Chapters examine such topics as analyzing the competitive effects of both horizontal and vertical mergers, detecting and preventing cartels, theoretical and empirical analysis of vertical restraints, state aids, the relationship of competition law to the defense of intellectual property, and the application of antitrust law to “bidding markets,” network industries, and two-sided markets. Contributors Mark Armstrong, Jonathan B. Baker, Timothy F. Bresnahan, Paulo Buccirossi, Nicholas Economides, Hans W. Friederiszick, Luke M. Froeb, Richard J. Gilbert, Joseph E. Harrington, Jr., Paul Klemperer, Kai-Uwe Kuhn, Francine Lafontaine, Damien J. Neven, Patrick Rey, Michael H. Riordan, Jean-Charles Rochet, Lars-Hendrick Röller, Margaret Slade, Giancarlo Spagnolo, Jean Tirole, Thibaud Vergé, Vincent Verouden, John Vickers, Gregory J. Werden

The Antitrust Paradox

Author : Robert Bork
Publisher :
ISBN 13 : 9781736089712
Total Pages : 536 pages
Book Rating : 4.0/5 (897 download)

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Book Synopsis The Antitrust Paradox by : Robert Bork

Download or read book The Antitrust Paradox written by Robert Bork and published by . This book was released on 2021-02-22 with total page 536 pages. Available in PDF, EPUB and Kindle. Book excerpt: The most important book on antitrust ever written. It shows how antitrust suits adversely affect the consumer by encouraging a costly form of protection for inefficient and uncompetitive small businesses.

The Economic Assessment of Mergers Under European Competition Law

Author : Daniel Gore
Publisher : Cambridge University Press
ISBN 13 : 1107007720
Total Pages : 559 pages
Book Rating : 4.1/5 (7 download)

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Book Synopsis The Economic Assessment of Mergers Under European Competition Law by : Daniel Gore

Download or read book The Economic Assessment of Mergers Under European Competition Law written by Daniel Gore and published by Cambridge University Press. This book was released on 2013-04-25 with total page 559 pages. Available in PDF, EPUB and Kindle. Book excerpt: Provides a clear, concise and practical overview of the key economic techniques and evidence employed in European merger control.

The Oxford Handbook of International Antitrust Economics

Author : Roger D. Blair
Publisher :
ISBN 13 : 0199859191
Total Pages : 633 pages
Book Rating : 4.1/5 (998 download)

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Book Synopsis The Oxford Handbook of International Antitrust Economics by : Roger D. Blair

Download or read book The Oxford Handbook of International Antitrust Economics written by Roger D. Blair and published by . This book was released on 2015 with total page 633 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Handbook examines the most important issues that arise in antitrust economics. Leading scholars in the field provide detailed critical analysis of developments across a number of different antitrust topics along with a detailed review of the literature. The Handbook is invaluable as a research and teaching tool.

Competition Law of the European Union

Author : Van Bael & Bellis
Publisher : Kluwer Law International B.V.
ISBN 13 : 9041154051
Total Pages : 1618 pages
Book Rating : 4.0/5 (411 download)

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Book Synopsis Competition Law of the European Union by : Van Bael & Bellis

Download or read book Competition Law of the European Union written by Van Bael & Bellis and published by Kluwer Law International B.V.. This book was released on 2021-03-01 with total page 1618 pages. Available in PDF, EPUB and Kindle. Book excerpt: This new Sixth Edition of a major work by the well-known competition law team at Van Bael & Bellis in Brussels brings the book up to date to take account of the many developments in the case law and relevant legislation that have occurred since the Fifth Edition in 2010. The authors have also taken the opportunity to write a much-extended chapter on private enforcement and a dedicated section on competition law in the pharmaceutical sector. As one would expect, the new edition continues to meet the challenge for businesses and their counsel, providing a thoroughly practical guide to the application of the EU competition rules. The critical commentary cuts through the theoretical underpinnings of EU competition law to expose its actual impact on business. In this comprehensive new edition, the authors examine such notable developments as the following: important rulings concerning the concept of a restriction by object under Article 101; the extensive case law in the field of cartels, including in relation to cartel facilitation and price signalling; important Article 102 rulings concerning pricing and exclusivity, including the Post Danmark and Intel judgments, as well as standard essential patents; the current block exemption and guidelines applicable to vertical agreements, including those applicable to the motor vehicle sector; developments concerning online distribution, including the Pierre Fabre and Coty rulings; the current guidelines and block exemptions in the field of horizontal cooperation, including the treatment of information exchange; the evolution of EU merger control, including court defeats suffered by the Commission and the case law on procedural infringements; the burgeoning case law related to pharmaceuticals, including concerning reverse payment settlements; the current technology transfer guidelines and block exemption; procedural developments, including in relation to the right to privacy, access to file, parental liability, fining methodology, inability to pay and hybrid settlements; the implementation of the Damages Directive and the first interpretative rulings. As a comprehensive, up-to-date and above all practical analysis of the EU competition rules as developed by the Commission and EU Courts, this authoritative new edition of a classic work stands alone. Like its predecessors, it will be of immeasurable value to both business persons and their legal advisers.

Somerfield Plc and Wm Morrison Supermarkets Plc

Author : Great Britain: Competition Commission
Publisher : The Stationery Office
ISBN 13 : 9780117035966
Total Pages : 156 pages
Book Rating : 4.0/5 (359 download)

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Book Synopsis Somerfield Plc and Wm Morrison Supermarkets Plc by : Great Britain: Competition Commission

Download or read book Somerfield Plc and Wm Morrison Supermarkets Plc written by Great Britain: Competition Commission and published by The Stationery Office. This book was released on 2005-09-12 with total page 156 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Competition Commission report examines the purchase by Somerfield plc of 115 stores and other assets from Wm Morrisons plc in October 2004. The Office of Fair Trading referred this to the Commission in March 2005, with competition concerns. The Commission has concluded that the completed acquisition may be expected to result in a substantial lessening of competition in 12 local grocery retail markets, as well as 14 local markets where acquisition gave concern. To restore competition in these markets Somerfield will have to sell 12 stores to suitable grocery retailers approved by the Commission. Somerfield group is the fifth largest supermarket group with a UK annual turnover of approximately £4.7 billion. It has 750 mid-range stores under Somerfield, and 500 under Kwik Save. Morrisons is the fourth largest grocery retailer in the UK, operating about 500 stores. An earlier Competition Commission report on mergers issued as a Command Paper (Cm.5950) is also available on the subject of proposed mergers between Safeway plc and Asda Group Limited (owned by Wal-Mart Stores Inc); Wm Morrison Supermarkets PLC; J Sainsbury plc; and Tesco plc (see ISBN 0101595026).

Research Handbook on the Economics of Antitrust Law

Author : Einer Elhauge
Publisher : Edward Elgar Publishing
ISBN 13 : 0857938096
Total Pages : 425 pages
Book Rating : 4.8/5 (579 download)

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Book Synopsis Research Handbook on the Economics of Antitrust Law by : Einer Elhauge

Download or read book Research Handbook on the Economics of Antitrust Law written by Einer Elhauge and published by Edward Elgar Publishing. This book was released on 2012 with total page 425 pages. Available in PDF, EPUB and Kindle. Book excerpt: One might mistakenly think that the long tradition of economic analysis in antitrust law would mean there is little new to say. Yet the field is surprisingly dynamic and changing. The specially commissioned chapters in this landmark volume offer a rigorous analysis of the field's most current and contentious issues. Focusing on those areas of antitrust economics that are most in flux, leading scholars discuss topics such as: mergers that create unilateral effects or eliminate potential competition; whether market definition is necessary; tying, bundled discounts, and loyalty discounts; a new theory of predatory pricing; assessing vertical price-fixing after Leegin; proving horizontal agreements after Twombly; modern analysis of monopsony power; the economics of antitrust enforcement; international antitrust issues; antitrust in regulated industries; the antitrust-patent intersection; and modern methods for measuring antitrust damages. Students and scholars of law and economics, law practitioners, regulators, and economists with an interest in industrial organization and consulting will find this seminal Handbook an essential and informative resource.