The Limits of Monopolization Through Acquisition

Kamien, Morton I.; Zang, Israël

doi:10.2307/2937796

Cited by 253 publications

(210 citation statements)

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“…17 Perry and Porter (1985) and Kamien and Zang (1990) and we let x i be the extraction level in district i 2 N = f1; :::; ng. The aggregate harvest, x = P i2N x i , is sold on a common market.…”

Section: A Theory Of Conservationmentioning

confidence: 99%

Conservation Contracts and Political Regimes

Harstad

Mideksa

2015

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Conservation Contracts and Political Regimes AbstractMotivated by tropical deforestation, we analyze (i) a novel theory of resource extraction, (ii) the optimal conservation contract, (iii) when the donor prefers contracting with central rather than local governments, and (iv) how the donor's presence may induce institutional change. Deforestation can be legal or illegal in the model: each district decides how much to protect and how much to extract for sale on a common market. If districts are strong, in that they find protection inexpensive, extraction is sales-driven and districts bene.t if neighbors conserve. If districts are weak, they lose when neighbors conserve since the smaller supply increases the price and the pressure on the resource, and thus also the cost of protection. Consequently, decentralizing authority increases conservation if and only if districts are weak. Contracting with the central authority is socially optimal, but, on the one hand, the donor benefits from contracting with districts if they are weak; on the other hand, districts prefer to decentralize if they are strong. The presence of the donor may lead to a regime change that increases extraction by more than it is reduced by the contract itself.JEL-Code: Q340.

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Section: A Theory Of Conservationmentioning

confidence: 99%

Conservation Contracts and Political Regimes

Harstad

Mideksa

2015

SSRN Journal

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“…17 Note that internationally merged …rms h and f have free access in both markets under hIi while …rm h 0 faces t F and …rm f 0 faces t H in the export markets. Thus, the export market access of …rms h 0 and f 0 is more limited relative to other market structures and this leads to a lower prohibitive tari¤ level under hIi:…”

Section: One International Mergermentioning

confidence: 99%

On the Relationship between Tariff Levels and the Nature of Mergers

Yildiz¹,

Ulus²

2012

The B.E. Journal of Economic Analysis &Amp; Policy

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This paper employs an endogenous merger formation approach in a two-country oligopoly model of trade to examine the international linkages between the nature of mergers and tari¤ levels. Firms sell di¤erentiated products and compete in a Bertrand fashion in product markets. We …nd two e¤ects playing key roles in determining equilibrium market structure: the tari¤ saving e¤ ect and the protection gain e¤ ect. The balance between these two e¤ects implies that, when foreign country practices free trade, unilateral tari¤ reduction by a domestic country yields international mergers irrespective of the substitutability levels. By contrast, when foreign tari¤s are su¢ ciently high and products are close substitutes, national mergers obtain in the equilibrium. Therefore, the implications of unilateral trade liberalization on the equilibrium market structure depends on the trade regime in foreign country especially when products are close substitutes. Unlike this asymmetric result of unilateral trade liberalization, we …nd that when bilateral tari¤s are su¢ ciently low, international mergers arise. These results …t well with the fact that global trade liberalization has been accompanied by an increase in international merger activities. Finally, from a welfare perspective, we show that international mergers are preferable to national mergers and thus social and private merger incentives become aligned together as trade gets bilaterally liberalized.

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“…In addition, it is assumed that there exists a plant specific fixed cost f , which has to be paid for each unit of the industry capital owned by the firm. 9 This way of modelling the cost structure aims at capturing two distinct cost effects induced by a merger. First, a merger brings the capital of merging parties into a single larger entity and, therefore, gives rise to endogenous efficiency gains.…”

Section: The Modelmentioning

confidence: 99%

“…6 The current paper is, therefore, also related to the literature on endogenous mergers. Some important papers in this area are Gowrisankaran (1999), Kamien and Zang (1990) profits. Lastly, Medvedev only considers situations where all firms in the industry are active both before and after the merger, while in this paper we also study the cases in which the outsiders to a merger may be pushed out of the industry if the merger is approved.…”

Section: Introductionmentioning

confidence: 99%

EFFICIENCY GAINS AND STRUCTURAL REMEDIES IN MERGER CONTROL^*

Vasconcelos

2010

The J Industrial Economics

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This paper studies the role of structural remedies in merger control in a Cournot setting where (endogenous) mergers are motivated by prospective efficiency gains. Every merger has to be submitted to an Antitrust Authority (AA) which, apart from blocking or unconditionally approving it, might approve a modified version of the concentration where divestitures are required. Some important merger policy implications can be drawn. First, when divestitures are required, the AA over-fixes, i.e., goes beyond the recreation of the level of competition that existed prior to the transaction. Second, by insisting in overfixing, the AA may discourage firms to look for more efficient mergers. Finally, structural remedies are shown to open up new merger opportunities to firms.

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The Limits of Monopolization Through Acquisition

Cited by 253 publications

References 0 publications

Conservation Contracts and Political Regimes

Conservation Contracts and Political Regimes

On the Relationship between Tariff Levels and the Nature of Mergers

EFFICIENCY GAINS AND STRUCTURAL REMEDIES IN MERGER CONTROL^*

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The Limits of Monopolization Through Acquisition

Cited by 253 publications

References 0 publications

Conservation Contracts and Political Regimes

Conservation Contracts and Political Regimes

On the Relationship between Tariff Levels and the Nature of Mergers

EFFICIENCY GAINS AND STRUCTURAL REMEDIES IN MERGER CONTROL*

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EFFICIENCY GAINS AND STRUCTURAL REMEDIES IN MERGER CONTROL^*