Arbeitspapier
How effective is European merger control?
This paper applies a novel methodology to a unique dataset of large concentrations during the period 1990-2002 to assess merger control’s effectiveness. By using data gathered from several sources and employing different evaluation techniques, we analyze the economic effects of the European Commission’s (EC) merger control decisions and distinguish between blockings, clearances with commitments (either behavioral or structural), and outright clearances. We run an event study on merging and rival firms’ stocks to quantify the profitability effects of mergers and merger control decisions. We back up our results and methodology by using alternative measures for the merger’s profitability effects based on balance-sheet data and obtain consistent results. Our findings suggest that outright blockings solve the competitive problems generated by the merger. Remedies are not always effective in solving the market power concerns, at least not on average. Nevertheless, both structural (divestitures) and behavioral remedies do help restore effective competition when correctly applied to anticompetitive mergers during the first investigation phase. Yet, they are on the whole ineffective or even detrimental when applied after the second investigation phase. Finally, remedies - especially behavioral ones - seem to constitute a rent transfer from merging firms to rivals when mistakenly applied to pro-competitive mergers.
- Language
-
Englisch
- Bibliographic citation
-
Series: WZB Discussion Paper ; No. SP II 2006-12
- Classification
-
Wirtschaft
Antitrust Law
Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
- Subject
-
Mergers, Merger Control
Remedies
European Commission
Event Studies
Ex-post Evaluation
- Event
-
Geistige Schöpfung
- (who)
-
Duso, Tomaso
Gugler, Klaus
Yurtoglu, Burçin
- Event
-
Veröffentlichung
- (who)
-
Wissenschaftszentrum Berlin für Sozialforschung (WZB)
- (where)
-
Berlin
- (when)
-
2006
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Duso, Tomaso
- Gugler, Klaus
- Yurtoglu, Burçin
- Wissenschaftszentrum Berlin für Sozialforschung (WZB)
Time of origin
- 2006
Other Objects (12)
How Effective is European Merger Control?
How effective is European merger control?
How effective is European merger control?
Effective European antitrust: Does EC merger policy generate deterrence?
25 Years of European Merger Control
25 years of European merger control
Effective European Antitrust : Does EC Merger Policy Generate Deterrence?
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
25 years of European merger control
The political economy of European merger control: evidence using stock market data
How Effective is European Merger Control?
How effective is European merger control?
How effective is European merger control?
Effective European antitrust: Does EC merger policy generate deterrence?
25 Years of European Merger Control
25 years of European merger control
Effective European Antitrust : Does EC Merger Policy Generate Deterrence?
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
25 years of European merger control
The political economy of European merger control: evidence using stock market data
How Effective is European Merger Control?
How effective is European merger control?
How effective is European merger control?
Effective European antitrust: Does EC merger policy generate deterrence?
25 Years of European Merger Control
25 years of European merger control
Effective European Antitrust : Does EC Merger Policy Generate Deterrence?
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
Using rival effects to identify synergies and improve merger typologies
25 years of European merger control