Strategic Non-Entry

• Autor(a) principal: Pinho Senra de Morais, Rafael
• Data de Publicação: 2017
• Tipo de documento: Artigo
• Idioma: por
• Título da fonte: Economic Analysis of law Review
• Texto Completo: https://portalrevistas.ucb.br/index.php/EALR/article/view/7171
• topic: Antitruste; Jogos de Entrada; Compra Hostil; Monopolização Internacional

This paper brings out a simple idea and a straight policy recommendation. The idea is that a producer in a given geographic or product market A may prefer not to enter another geographic or product market B in order to acquire the monopoly power holder in B at a later date without being challenged by the antitrust/competition authority competent for B – to the harm of consumers in B.We provide stylized facts for this non-entry plus later entry-by-acquisition behaviour and build a game-theoretical model supporting them. Our model extends the classic entry model highlighting the rationale for the observed behaviour.The straight policy implication is that competition/antitrust authorities should pay more attention to proposed mergers where market power only changes hands. The possibility of blocking those mergers – if no efficiency gain compared to entry by building is shown – should be seriously considered, as a more dynamic setting like ours suggests.