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- Title
Unilateral Competitive Effects of Mergers: Upward Pricing Pressure, Product Quality, and Other Extensions.
- Authors
Willig, Robert
- Abstract
This paper lays out and extends a derivation of the 'upward pricing pressure' ('UPP') tool for analyzing unilateral competitive effects of horizontal mergers on differentiated products that is featured in the 2010 Guidelines. In the most novel extension, the merger alters the differentiated products' qualities. The resulting tool analyzes whether the merger creates upward pressure on quality-adjusted or 'hedonic' prices. Another extension applies where one firm acquires just a partial equity stake in a competing firm. The paper also develops the Gross Upward Market Power Pressure Index (GUMPPI) that generalizes UPP measures to include output as well as price effects.
- Subjects
MERGERS &; acquisitions law; ECONOMIC competition; PRODUCT quality; HORIZONTAL integration; BUSINESS enterprises; EQUITY stake; MARKET power; PRICES
- Publication
Review of Industrial Organization, 2011, Vol 39, Issue 1/2, p19
- ISSN
0889-938X
- Publication type
Article
- DOI
10.1007/s11151-011-9307-7