This paper investigates the exercise of market power by a large buyer who emerges via growth, merger, or group purchasing. It explores the efficiency and redistributive effects of such an event when a competitive fringe of small buyers remains in the market. Terms of trade, including those for...

This paper examines the efficiency and price effects of mergers by applying a frontier profit function to data on bank `megamergers'. We find that merged banks experience a statistically significant 16 percentage point average increase in profit efficiency rank relative to other large banks....

Traditional concerns about concentration in product markets have centered on the social losses associated with the mispricing that occur when market power is exercised. This paper focuses on a potentially greater loss from market power -- a reduction in cost efficiency brought about by the lack...

This paper examines the efficiency and price effects of mergers by applying a frontier profit function to data on bank quot;megamergers.quot; We find that merged banks experience a statistically significant 16 percentage point average increase in profit efficiency rank relative to other large...

This paper analyzes competitive pricing policies by multiproduct firms facing heterogeneous buying patterns. We show that cross-subsidization arises when firms have comparative advantages on different products but are equally efficient overall: Firms earn a profit from multi-stop shoppers by...

Sales are a widespread and well-known phenomenon that has been documented in several product markets. Regularities in such periodic price reductions appear to suggest that the phenomenon cannot be entirely attributed to random variations in supply, demand, or the aggregate price level. Certain...

We study final product manufacturers’ incentives to introduce new products into the market and how they are affected by a merger among them. We show that when manufacturers distribute their products through multi-product retailers, a manufacturers merger, although it leads to an increase in...

In this paper we investigate the connection between cost asymmetries and the sustainability of collusion within the context of a infinitely repeated Cournot duopoly. We assume that firms are able to coordinate on distinct output levels than the unrestricted joint profit maximization outcome. We...

We examine the relationship between concentration and price dispersion using variation induced by a merger in the Canadian mortgage market. Since interest rates are determined through a search and negotiation process, consolidation eliminates a potential negotiation part- ner, weakening...