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Merger effects in asymmetric and differentiated Bertrand oligopolies

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  • Wang, X. Henry
  • Zhao, Jingang

Abstract

This paper advances Motta’s (2004) study of two-firm Bertrand mergers with arbitrary synergies in symmetric linear models to m-firm mergers with cost-savings in asymmetric linear models. It identifies a set of Bertrand mergers that reduce not only consumer surplus but also rival firms’ profits. Such severely anti-competitive mergers are intriguing because they can never happen in both Farrell and Shapiro (1990) and Nocke and Schutz (2018).

Suggested Citation

  • Wang, X. Henry & Zhao, Jingang, 2022. "Merger effects in asymmetric and differentiated Bertrand oligopolies," Mathematical Social Sciences, Elsevier, vol. 120(C), pages 37-49.
    • Handle: RePEc:eee:matsoc:v:120:y:2022:i:c:p:37-49
    DOI: 10.1016/j.mathsocsci.2022.09.002
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    1. Bakaouka, Elpiniki & Escrihuela-Villar, Marc & Ferrarese, Walter, 2024. "Horizontal mergers with Bertrand competition and convex costs," Mathematical Social Sciences, Elsevier, vol. 128(C), pages 60-67.

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