Spatial Competition and Merger
We consider a computational equilibrium model of spatially differentiated Bertrand competition and apply it to merger analysis. Two pricing paradigms are studied: one where firms cannot price discriminate among customers and one where firms can. The model encompasses many details that make it highly realistic. A detailed example illustrates several insights into merger analysis that are not readily apparent through traditional means. The most important of these is that merger of substitute products under Bertrand price competition need not result in a price increase.
Year of publication: |
2004
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Authors: | S, Higgins Richard ; A, Johnson Paul ; T, Sullivan John |
Published in: |
The B.E. Journal of Economic Analysis & Policy. - De Gruyter, ISSN 1935-1682. - Vol. 4.2004, 1, p. 1-37
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Publisher: |
De Gruyter |
Saved in:
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Spatial Competition and Merger
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