TY - JOUR
T1 - Mergers and difference-in-difference estimator
T2 - Why firms do not increase prices?
AU - Jiménez, Juan Luis
AU - Perdiguero, Jordi
N1 - Publisher Copyright:
© 2014, Springer Science+Business Media New York.
Copyright:
Copyright 2020 Elsevier B.V., All rights reserved.
PY - 2018/4/1
Y1 - 2018/4/1
N2 - Difference-in-difference methods are being increasingly used to analyze the impact of mergers on pricing and other market equilibrium outcomes. Using evidence from an exogenous merger between two retail gasoline companies in a specific market in Spain, this paper shows how concentration did not lead to a price increase. In fact, the conjectural variation model concludes that the existence of a collusive agreement before and after the merger accounts for this result, rather than the existence of efficient gains. This result may explain empirical evidence reported in the literature according to which mergers between firms do not have significant effects on prices.
AB - Difference-in-difference methods are being increasingly used to analyze the impact of mergers on pricing and other market equilibrium outcomes. Using evidence from an exogenous merger between two retail gasoline companies in a specific market in Spain, this paper shows how concentration did not lead to a price increase. In fact, the conjectural variation model concludes that the existence of a collusive agreement before and after the merger accounts for this result, rather than the existence of efficient gains. This result may explain empirical evidence reported in the literature according to which mergers between firms do not have significant effects on prices.
KW - Conjectural variation
KW - Difference-in-difference
KW - Gasoline market
KW - Mergers
UR - http://www.scopus.com/inward/record.url?scp=85058910160&partnerID=8YFLogxK
U2 - 10.1007/s10657-014-9437-0
DO - 10.1007/s10657-014-9437-0
M3 - Article
AN - SCOPUS:85058910160
SN - 0929-1261
VL - 45
SP - 285
EP - 311
JO - European Journal of Law and Economics
JF - European Journal of Law and Economics
IS - 2
ER -