Horizontal mergers and product quality

Detalhes bibliográficos
Autor(a) principal: Brekke, Kurt R.
Data de Publicação: 2014
Outros Autores: Siciliani, Luigi, Straume, Odd Rune
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
Texto Completo: http://hdl.handle.net/1822/27959
Resumo: Using a spatial competition framework with three ex ante identical firms, we study the effects of a horizontal merger on quality, price and welfare. The merging firms always reduce quality. They also increase prices if demand responsiveness to quality is sufficiently low. The non-merging firm, on the other hand, always responds by increasing both quality and prices. Overall, a merger leads to higher average prices and quality in the market. The welfare implications of a merger are not clear-cut. If the demand responsiveness to quality is sufficiently high, some consumers benefit from the merger and social welfare might also increase.
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spelling Horizontal mergers and product qualityHorizontal mergersQualitySpatial competitionUsing a spatial competition framework with three ex ante identical firms, we study the effects of a horizontal merger on quality, price and welfare. The merging firms always reduce quality. They also increase prices if demand responsiveness to quality is sufficiently low. The non-merging firm, on the other hand, always responds by increasing both quality and prices. Overall, a merger leads to higher average prices and quality in the market. The welfare implications of a merger are not clear-cut. If the demand responsiveness to quality is sufficiently high, some consumers benefit from the merger and social welfare might also increase.COMPETE, QREN, FEDER, Fundação para a Ciência e a Tecnologia (FCT)Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)Universidade do MinhoBrekke, Kurt R.Siciliani, LuigiStraume, Odd Rune20142014-01-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/1822/27959enghttp://www.nipe.eeg.uminho.pt/Uploads/NIPE_WP_07_2014.pdfinfo:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-07-21T12:11:00Zoai:repositorium.sdum.uminho.pt:1822/27959Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T19:02:42.525838Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse
dc.title.none.fl_str_mv Horizontal mergers and product quality
title Horizontal mergers and product quality
spellingShingle Horizontal mergers and product quality
Brekke, Kurt R.
Horizontal mergers
Quality
Spatial competition
title_short Horizontal mergers and product quality
title_full Horizontal mergers and product quality
title_fullStr Horizontal mergers and product quality
title_full_unstemmed Horizontal mergers and product quality
title_sort Horizontal mergers and product quality
author Brekke, Kurt R.
author_facet Brekke, Kurt R.
Siciliani, Luigi
Straume, Odd Rune
author_role author
author2 Siciliani, Luigi
Straume, Odd Rune
author2_role author
author
dc.contributor.none.fl_str_mv Universidade do Minho
dc.contributor.author.fl_str_mv Brekke, Kurt R.
Siciliani, Luigi
Straume, Odd Rune
dc.subject.por.fl_str_mv Horizontal mergers
Quality
Spatial competition
topic Horizontal mergers
Quality
Spatial competition
description Using a spatial competition framework with three ex ante identical firms, we study the effects of a horizontal merger on quality, price and welfare. The merging firms always reduce quality. They also increase prices if demand responsiveness to quality is sufficiently low. The non-merging firm, on the other hand, always responds by increasing both quality and prices. Overall, a merger leads to higher average prices and quality in the market. The welfare implications of a merger are not clear-cut. If the demand responsiveness to quality is sufficiently high, some consumers benefit from the merger and social welfare might also increase.
publishDate 2014
dc.date.none.fl_str_mv 2014
2014-01-01T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/1822/27959
url http://hdl.handle.net/1822/27959
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv http://www.nipe.eeg.uminho.pt/Uploads/NIPE_WP_07_2014.pdf
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)
publisher.none.fl_str_mv Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)
dc.source.none.fl_str_mv reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
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repository.name.fl_str_mv Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
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