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An Experimental Approach to Merger Evaluation

Conlon, Christopher T. - 2013

The 2010 Department of Justice and Federal Trade Commission Horizontal Merger Guidelines lay out a new standard for assessing proposed mergers in markets with differentiated products. This new standard is based on a measure of ``upward pricing pressure,'' (UPP) and the calculation of a ``gross...

Persistent link: https://www.econbiz.de/10013071901

Monopoly Power and Endogenous Product Variety : Distortions and Remedies

Bilbiie, Florin Ovidiu; Ghironi, Fabio Pietro; Melitz, … - 2021

The inefficiencies related to endogenous product creation and variety under monopolistic competition are two-fold: one static—the misalignment between consumers and producers regarding the value of a new variety; and one dynamic—time variation in markups. Quantitatively, the welfare costs of...

Persistent link: https://www.econbiz.de/10013232463

The Strategic Use of Tying to Preserve and Create Market Power in Evolving Industries

Carlton, Dennis W.; Waldman, Michael - 2021

This paper investigates how the tying of complementary products can be used to preserve and extend monopoly positions …. We first show how a firm that is a monopolist of a product in the current period can use tying to preserve its monopoly … monopoly position into a newly emerging market. The analysis focuses on the importance of entry costs and network externalities …

Persistent link: https://www.econbiz.de/10013244368

Fixed Costs and the Product Market Treatment of Preference Minorities

Berry, Steven - 2014

It is well documented that, in the presence of substantial fixed costs, markets offer preference majorities more variety than preference minorities. This fact alone, however, does not demonstrate the market outcome is in any way biased against preference minorities. In this paper, we clarify the...

Persistent link: https://www.econbiz.de/10013047395

Unobserved Product Differentiation in Discrete Choice Models : Estimating Price Elasticities and Welfare Effects

Ackerberg, Daniel A.; Rysman, Marc - 2022

Standard discrete choice models such as logit, nested logit, and random coefficients models place very strong restrictions on how unobservable product space increases with the number of products. We argue (and show with Monte Carlo experiments) that these restrictions can lead to biased...

Persistent link: https://www.econbiz.de/10013308340

Preference Externalities : An Empirical Study of Who Benefits Whom in Differentiated Product Markets

Waldfogel, Joel - 2021

Theory predicts that in markets with increasing returns, the number of differentiated products and resulting consumer satisfaction grow in market size. We document this phenomenon across 246 US radio markets. By a mechanism that we term 'preference externalities', an increase in the size of the...

Persistent link: https://www.econbiz.de/10013240531

Who Benefits Whom in Daily Newspaper Markets?

Waldfogel, Joel; George, Lisa M. - 2021

Markets are generally thought to avoid problems, such as tyranny of the majority, that arise when allocation is accomplished through collective processes. Yet, with fixed costs, differentiated product markets deliver only products desired by substantial constituencies. When consumers share...

Persistent link: https://www.econbiz.de/10013212573

Transfer Pricing by U.S.-Based Multinational Firms

Bernard, Andrew B. - 2012

This paper examines how prices set by multinational firms vary across arm's-length and related-party customers. Comparing prices within firms, products, destination countries, modes of transport and month, we find that the prices U.S. exporters set for their arm's-length customers are...

Persistent link: https://www.econbiz.de/10012755471

Optimal Monetary Policy with Endogenous Entry and Product Variety

Bilbiie, Florin Ovidiu - 2011

We show that deviations from long-run stability of product prices are optimal in the presence of endogenous producer entry and product variety in a sticky-price model with monopolistic competition in which price stability would be optimal in the absence of entry. Specifically, a long-run...

Persistent link: https://www.econbiz.de/10013119776

Airline Hubs : Costs, Markups and the Implications of Customer Heterogeneity

Berry, Steven; Spiller, Pablo T.; Carnall, Michael - 2021

a `monopoly umbrella' to other non-hub airlines. Finally, on the cost side there is evidence of economies of density …

Persistent link: https://www.econbiz.de/10013240526

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