Abstract
Policy choices often entail trade-offs between workers and consumers. I assess how foreign competition changes the consumer welfare and domestic employment effects of a merger. I construct a model accounting for demand responses, endogenous product portfolios, and employment. I apply this model to the acquisition of Maytag by Whirlpool in the household appliance industry. I compare the observed acquisition to one with a foreign buyer. While a Whirlpool acquisition decreased consumer welfare by $250 million, it led to 1,300 fewer domestic jobs lost. Jobs need to be worth above $220,000 annually for domestic employment effects to offset consumer harm.
Dokumententyp: | Paper |
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Fakultät: | Volkswirtschaft > Collaborative Research Center Transregio "Rationality and Competition" |
Themengebiete: | 300 Sozialwissenschaften > 330 Wirtschaft |
JEL Classification: | F61, L13, L40 |
URN: | urn:nbn:de:bvb:19-epub-94451-8 |
Sprache: | Englisch |
Dokumenten ID: | 94451 |
Datum der Veröffentlichung auf Open Access LMU: | 06. Feb. 2023, 09:52 |
Letzte Änderungen: | 06. Feb. 2023, 09:53 |