Merger Analysis with Unobserved Prices
Fuente:
arXiv
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| Format: | Preprint |
| Publié: |
2024
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| _version_ | 1866911130275807232 |
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| author | Koh, Paul S. |
| author_facet | Koh, Paul S. |
| contents | Standard empirical tools for merger analysis assume price data, which are often unavailable. I characterize sufficient conditions for identifying the unilateral effects of mergers without price data using the first-order approach and merger simulation. Data on merging firms' revenues, margins, and revenue diversion ratios are sufficient to identify their gross upward pricing pressure indices and compensating marginal cost reductions. Standard discrete-continuous demand assumptions facilitate the identification of revenue diversion ratios as well as the feasibility of merger simulation in terms of percentage change in price. I apply the framework to the Albertsons/Safeway (2015) and Staples/Office Depot (2016) mergers. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2404_07684 |
| institution | arXiv |
| publishDate | 2024 |
| record_format | arxiv |
| spellingShingle | Merger Analysis with Unobserved Prices Koh, Paul S. Econometrics Standard empirical tools for merger analysis assume price data, which are often unavailable. I characterize sufficient conditions for identifying the unilateral effects of mergers without price data using the first-order approach and merger simulation. Data on merging firms' revenues, margins, and revenue diversion ratios are sufficient to identify their gross upward pricing pressure indices and compensating marginal cost reductions. Standard discrete-continuous demand assumptions facilitate the identification of revenue diversion ratios as well as the feasibility of merger simulation in terms of percentage change in price. I apply the framework to the Albertsons/Safeway (2015) and Staples/Office Depot (2016) mergers. |
| title | Merger Analysis with Unobserved Prices |
| topic | Econometrics |
| url | https://arxiv.org/abs/2404.07684 |