What Can Merger Retrospectives Tell Us? An Assessment of European Mergers

Posted by Social Science Research Network

What Can Merger Retrospectives Tell Us? An Assessment of European Mergers

Franco Mariuzzo, Peter L. Ormosi (University of East Anglia) & Richard Havell

Abstract:      In this review of retrospective European merger studies we provide a discussion of the price effect of analysed mergers and examine whether the antitrust agency made the right decisions. We find that remedied mergers, on average, were not followed by a price-increase, suggesting that, in our sample, merger interventions were effective at eliminating problems. High market concentration was more likely to lead to higher post-merger prices, although remedies were able to reduce post-merger price-increases, even in concentrated markets. We look at a number of reasons why prices may increase post-merger and find little evidence of genuine agency errors.