Download now Free registration required
This paper contributes to the economic analysis of merger control by taking into account the efficiency gains for the design of structural merger remedies when the competition authorities do not observe the magnitude of efficiency gains. The authors show that whenever divestitures are necessary, the Competition Authority will need to extract from the merging partners their private information on the merger's efficiency gains. For this they propose a revelation mechanism combining divestitures with two additional tools, the regulation of the divestitures sale price and a merger fee. They show that an optimal combination of both instruments is effective: the most efficient merged firms are claimed to pay a merger fee while the less efficient divest assets at an upwards distorted sale price.
- Format: PDF
- Size: 322.2 KB