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Evaluating the Evidence on Vertical Mergers

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  • Marissa Beck

    (Charles River Associates)

  • Fiona Scott Morton

    (Yale School of Management)

Abstract

In theory, vertical mergers can have both procompetitive and anticompetitive effects. Many early empirical studies found benefits for vertical relationships; but the seminal surveys of this literature are now over a decade old. We review the empirical evidence from the last decade on vertical integration—as well as that in two frequently cited surveys from the mid-2000s. Taken as a whole, the empirical evidence as to the change in welfare that is due to vertical mergers is decidedly mixed, and should certainly not be used as a basis for a presumption that most vertical mergers are procompetitive or harmless.

Suggested Citation

  • Marissa Beck & Fiona Scott Morton, 2021. "Evaluating the Evidence on Vertical Mergers," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 59(2), pages 273-302, September.
    • Handle: RePEc:kap:revind:v:59:y:2021:i:2:d:10.1007_s11151-021-09832-z
    DOI: 10.1007/s11151-021-09832-z
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    Cited by:

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    2. Haucap, Justus & Stiebale, Joel, 2023. "Non-price effects of mergers and acquisitions," DICE Discussion Papers 402, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    3. Roger D. Blair, 2021. "The 2020 Vertical Merger Guidelines," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 59(2), pages 133-138, September.
    4. Gleb B. Domnenko & David S. Sibley, 2023. "Simulating Vertical Mergers," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 62(2), pages 99-118, March.
    5. Tirza J. Angerhofer & Roger D. Blair, 2021. "Successive Monopoly, Bilateral Monopoly and Vertical Mergers," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 59(2), pages 343-361, September.
    6. Javier D. Donna & Pedro Pereira, 2024. "Structural Presumptions for Non-horizontal Mergers in the 2023 Merger Guidelines: A Primer and a Path Forward," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 65(1), pages 303-345, August.
    7. Lancieri, Filippo Maria & Valleti, Tommaso, 2024. "Towards an effective merger review policy: A defence of rebuttable structural presumptions," Working Papers 345, The University of Chicago Booth School of Business, George J. Stigler Center for the Study of the Economy and the State.
    8. Roger D. Blair & Christine Piette Durrance, 2024. "Illumina-GRAIL in Retrospect," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 65(1), pages 347-360, August.
    9. Michael A. Salinger, 2021. "The New Vertical Merger Guidelines: Muddying the Waters," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 59(2), pages 161-176, September.

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