Working Paper Series
Why Event Studies Do Not Detect Anti-Competitive Mergers
() and Johan Stennek
Abstract: Anticompetitive mergers increase competitors' profits,
since they reduce competition. Using a model of endogenous mergers, we show
that such mergers nevertheless may reduce the competitors' share-prices.
Thus, event-studies can not detect anti-competitive mergers.
Keywords: Mergers & Acquisitions; Event Studies; Antitrust; Coalition Formation; (follow links to similar papers)
JEL-Codes: G14; G34; L12; L41; (follow links to similar papers)
8 pages, December 14, 2000
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