Abstract
We propose a model in which mergers exert a more pronounced effect on the structure of a market than simply reducing the number of competitors. We show that this may render horizontal mergers profitable and welfare-improving even if costs are linear. The results help to reconcile theory with various empirical findings on mergers.
Item Type: | Paper |
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Keywords: | efficient hedging; quantile hedging; jump-diffusion; martingale measure |
Faculties: | Economics > Chairs > MPI for Tax Law and Public Finance |
Subjects: | 300 Social sciences > 330 Economics |
Language: | English |
Item ID: | 24422 |
Date Deposited: | 31. Mar 2015, 07:33 |
Last Modified: | 03. Mar 2017, 10:54 |