Assessing EU Merger Control through Compensating Efficiencies

Tomaso Duso (), Pauline Affeldt, Klaus Gugler and Joanna Piechucka

No 16705, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Worldwide, the overwhelming majority of large horizontal mergers are cleared by antitrust authorities unconditionally. The presumption seems to be that efficiencies from these mergers are sizeable. We calculate the compensating efficiencies that would prevent a merger from harming consumers for 1,014 mergers affecting 12,325 antitrust markets scrutinized by the European Commission between 1990 and 2018. Compensating efficiencies seem too large to be achievable for many mergers. Barriers to entry and the number of firms active in the market are the most important factors determining their size. We highlight concerns about the Commission's merger enforcement being too lax.

Keywords: Compensating efficiencies; Efficiency gains; Merger control; Concentration; Screens; Hhi; Mergers; Unilateral effects; Market definition; Entry barriers (search for similar items in EconPapers)
JEL-codes: K21 L19 L24 L40 (search for similar items in EconPapers)
Date: 2021-11
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Working Paper: Assessing EU Merger Control through Compensating Efficiencies (2021)
Working Paper: Assessing EU Merger Control through Compensating Efficiencies (2021)
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