The Profitability of Small Horizontal Mergers with Nonlinear Demand Functions

Arbeitspapier

We want to take a differential game approach with price dynamics to conduct an investigation into the consequences of horizontal merger of firms where the demand function is nonlinear. We take into consideration the open-loop equilibrium. We show that in relation to the fact that the demand is nonlinear and prices follow some stickiness an incentive for small merger exists, while it does not appear under the standard approach using a linear demand function.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Quaderni - Working Paper DSE ; No. 728

Classification and Topics

• Classification: Wirtschaft ; Stochastic and Dynamic Games; Evolutionary Games; Repeated Games ; Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection ; Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance ; Oligopoly and Other Imperfect Markets

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Esfahani, Hamideh ; Lambertini, Luca
• Event: Veröffentlichung
• (who): Alma Mater Studiorum - Università di Bologna, Dipartimento di Scienze Economiche (DSE)
• (where): Bologna
• (when): 2011

Further information

• DOI: doi:10.6092/unibo/amsacta/4513
• Handle: http://hdl.handle.net/10419/159569
• Last update: 10.03.2025, 11:43 AM CET