Mergers, Merger Control, and Remedies
A Retrospective Analysis of U.S. Policy
- Winner of the fourteenth annual Jerry S. Cohen Memorial Fund Writing Award for antitrust scholarship, presented in 2016.
288 pp., 6 x 9 in, 8 figures, 39 tables
- Published: December 19, 2014
- Published: December 19, 2014
A comprehensive analysis of merger outcomes based on all empirical studies, with an assessment of the effectiveness of antitrust policy toward mergers.
In recent decades, antitrust investigations and cases targeting mergers—including those involving Google, Ticketmaster, and much of the domestic airline industry—have reshaped industries and changed business practices profoundly. And yet there has been a relative dearth of detailed evaluations of the effects of mergers and the effectiveness of merger policy. In this book, John Kwoka, a noted authority on industrial organization, examines all reliable empirical studies of the effect of specific mergers and develops entirely new information about the policies and remedies of antitrust agencies regarding these mergers. Combined with data on outcomes, this policy information enables analysis of, and creates new insights into, mergers, merger policies, and the effectiveness of remedies in preventing anticompetitive outcomes.
After an overview of mergers, merger policy, and a common approach to merger analysis, Kwoka offers a detailed analysis of the studied mergers, relevant policies, and chosen remedies. Kwoka finds, first and foremost, that most of the studied mergers resulted in competitive harm, usually in the form of higher product prices but also with respect to various non-price outcomes. Other important findings include the fact that joint ventures and code sharing arrangements do not result in such harm and that policies intended to remedy mergers—especially conduct remedies—are not generally effective in restraining price increases. The book's uniquely comprehensive analysis advances our understanding of merger decisions and policies, suggests policy improvements for competition agencies and remedies, and points the way to future research.
Mergers, Merger Control, and Remedies is foremost an economics book. But it has a high readability factor for non-economist antitrust practitioners and policy makers. This derives largely from Kwoka's seamless and intuitive linking of empirics, to valuable insight into observed agency outcomes, to implications for merger policy. As a result, the book is a must-read for economists, lawyers, institutional experts, and policy makers.
Diana L. Moss
The American Antitrust Institute
This first-ever comprehensive review of the retrospective studies of mergers both supports and challenges U.S. antitrust enforcers. Kwoka finds that opposition to mergers is usually justified, but that enforcers clear too many harmful mergers and often impose inadequate conduct remedies. Debates over merger policy can no longer proceed without reference to empirical evidence.
Jonathan B. Baker, Professor, American University Washington College of Law; former Director, Bureau of Economics, Federal Trade Commission
Mergers, Merger Control, and Remedies fills the voids in our general knowledge about U.S. policy on mergers, the effectiveness of that policy, and the consequences of mergers that do occur for consumers and other market participants. Kwoka is clear and complete in his discussion of the analytical challenges of studying these questions and is persuasive in his argument that these issues are of central importance in the US economy and, in particular, in the crafting of US merger policy. Lawyers, economic consultants, and government officials will benefit from reading this book.
Sara Fisher Ellison, Department of Economics, MIT
Merger policy is starting to be influenced by the growing literature on merger retrospectives, and Kwoka's book brings that work together, offering a great way to learn about it. I look forward to teaching from this book and I strongly recommend it to antitrust decision-makers.
Joseph Farrell, Professor of Economics, University of California, Berkeley; former Chief Economist, Department of Justice and Federal Trade Commission
Kwoka's new book effectively sets the stage for...enforcement agencies to undertake initiatives and projects...[T]he book moves the debate forward and toward steps to improve the effectiveness of merger enforcement policies.
Robert A. Skitol
The Antitrust Source
A frequent lament in academe goes this way: 'Wouldn't it be great if someone put together all of the studies on....' For retrospective analyses of 'close call' but nevertheless consummated mergers, Kwoka (Northeastern Univ.) provides just that—and more. Highly Recommended.