Welfare-enhancing mergers under product differentiation
In this paper we consider a model of duopoly with differentiated products to examine the welfare effects of a merger between two asymmetric firms. We find that, for quantity competition, the parameter range for welfare-enhancing merger widens if the products are closer substitutes. On the other hand, mergers are never welfare enhancing in this setting when firms compete in prices.
|Collections||ANU Research Publications|
|Source:||Manchester School, The|
|01_Kao_Welfare-enhancing_mergers_2010.pdf||172.86 kB||Adobe PDF||Request a copy|
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