The Empirical Basis for Antitrust: Cartels, Mergers, and Remedies

There have been a number of studies attempting to quantify the impact of cartels and mergers on prices. The state of the art of empirical analysis related to antitrust is best illustrated by the research of John Connor and John Kwoka. Connor summarizes the existing empirical research that estimates...

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Bibliographic Details
Published in:International journal of the economics of business 2017-05, Vol.24 (2), p.233-250
Main Author: Langenfeld, James
Format: Article
Language:English
Subjects:
Acquisitions & mergers
Antitrust
Basis
Cartels
Economic theory
Enforcement
Fines
Merger Regulation
Mergers
Natural Experiments
Price Fixing
Price Increases
Prices
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Summary:There have been a number of studies attempting to quantify the impact of cartels and mergers on prices. The state of the art of empirical analysis related to antitrust is best illustrated by the research of John Connor and John Kwoka. Connor summarizes the existing empirical research that estimates the magnitude of the impact of cartels on prices. He estimates that cartels increase prices by >20% on average, and concludes that fines and damage awards do not sufficiently deter cartels and should be larger. Kwoka summarizes research estimating the impact of mergers on prices and other market outcomes, and recommends tighter merger regulation. Since the works of both have been used to support more aggressive antitrust enforcement, it is important to understand the basis for their research and how it is best weighed. This article critiques their substantial efforts to add more empirical content as the basis for antitrust policies.
ISSN:1357-1516
1466-1829
DOI:10.1080/13571516.2017.1279376