The merger paradox in a mixed oligopoly |
| |
| Authors: | Benjamin Artz John S Heywood Matthew McGinty |
| |
| Institution: | 1. Department of Economics, Management and Statistics, University of Milano-Bicocca, U6 Building, Piazza dell’Ateneo Nuovo 1, Milano 20126, Italy;2. Department of Mathematics and its Applications, University of Milano-Bicocca, U5 Building, Via Cozzi 55, Milano 20125, Italy;1. European Commission and Barcelona Graduate School of Economics. DG Competition, B 1049, Brussels, Belgium;2. European Commission. DG Competition, B 1049, Brussels, Belgium;3. European Commission, Imperial College London and University of Rome II. South Kensington campus, London SW7 2AZ, United Kingdom |
| |
| Abstract: | This paper examines the set of surplus maximizing mergers in a model of mixed oligopoly. The presence of a welfare maximizing public firm reduces the set of mergers for which two private firms can profitably merge. When a public firm and private firm merge, the changes in welfare and profit depend on the resulting extent of private ownership in the newly merged firm. When the government sets that share to maximize post merger welfare as assumed in the privatization literature, the merger paradox will often remain and the merger will not take place. Yet, we show there always exists scope for mergers that increase profit and increase (if not maximize) welfare. Interestingly, these mergers often include complete privatization. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
