Upward Price Pressure, Merger Simulation, and Merger Simulation Light PDF Download
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Author: Michael D. Noel
Publisher:
ISBN:
Category :
Languages : en
Pages : 8
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Book Description
The Federal Trade Commission and the Antitrust Division of the Department of Justice have traditionally used market shares as an early preliminary screen in evaluating the potential for anticompetitive effects of a proposed merger. Recently, Farrell and Shapiro proposed a new merger screen known as Upward Price Pressure. This article discusses the advantages and disadvantages of this screen, contrasts it to more complicated full merger simulations, and ultimately suggests a merger simulation light approach that has elements of both and that may be more useful in the very early stages of analysis.
Author: Michael D. Noel
Publisher:
ISBN:
Category :
Languages : en
Pages : 8
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Book Description
The Federal Trade Commission and the Antitrust Division of the Department of Justice have traditionally used market shares as an early preliminary screen in evaluating the potential for anticompetitive effects of a proposed merger. Recently, Farrell and Shapiro proposed a new merger screen known as Upward Price Pressure. This article discusses the advantages and disadvantages of this screen, contrasts it to more complicated full merger simulations, and ultimately suggests a merger simulation light approach that has elements of both and that may be more useful in the very early stages of analysis.
Author: Nathan H. Miller
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Author: Gregory Werden
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 42
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Book Description
Author: Lydia Cheung
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 0
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Book Description
Author: Lapo Filistrucchi
Publisher:
ISBN:
Category :
Languages : en
Pages : 30
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Book Description
Author: Geoffrey Michael Pofahl
Publisher:
ISBN:
Category :
Languages : en
Pages : 349
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Book Description
The goal of the final essay is to explore the implementation of more realistic supply channel interactions in merger simulations. In particular, a two-stage pricing game is used to conduct merger simulations in the refrigerated orange juice category. The overriding finding is that comparisons with conventionally used models will not be practical until the relationship between demand specification and two-stage game modeling is better understood.
Author: David Reitman
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
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.
Author: Roy Jacob Epstein
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 0
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Author: Geoffrey M. Pofahl
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Author: Elizabeth M. Bailey
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
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.
