Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159412
Authors: 
Dragone, Davide
Lambertini, Luca
Mantovani, Andrea
Year of Publication: 
2006
Series/Report no.: 
Quaderni - Working Paper DSE 571
Abstract: 
We examine the profitability and social efficiency of horizontal mergers in a Cournot oligopoly with decreasing average costs. Assuming the merger allows for a reduction in the total amount of fixed costs, we identify the conditions under which the merger is, respectively, profitable and socially desirable. There exists an admissible parameter range wherein the merger is socially convenient but not profitable. In such a case, the policy maker may induce firms to merge through subsidies financed via a lump sum tax.
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by/3.0/
Document Type: 
Working Paper

Files in This Item:
File
Size
143.96 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.