Merger Enforcement: Out of the Courtroom after 75 Years

Merger policy has undergone many changes during the 75 years since the Clayton Act was adopted in 1914. It is recognized that horizontal combinations are the major concern of antitrust authorities. Even with a consensus on the appropriateness of a merger policy that focuses on horizontal acquisition...

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Bibliographic Details
Published in:Antitrust bulletin 1990-10, Vol.35 (3), p.677-694
Main Author: McGuckin, Robert H.
Format: Article
Language:English
Subjects:
Acquisitions & mergers
Antitrust
Antitrust laws
Clayton Antitrust Act 1914-US
Manufacturing
Market shares
Policy making
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Summary:Merger policy has undergone many changes during the 75 years since the Clayton Act was adopted in 1914. It is recognized that horizontal combinations are the major concern of antitrust authorities. Even with a consensus on the appropriateness of a merger policy that focuses on horizontal acquisitions, there is still argument about the specific standards and rules used to judge when a horizontal combination is anticompetitive. An examination of horizontal mergers among large manufacturing firms from 1972 to 1982 (using postmerger price-cost margins, market share, and related conduct and performance information) shows whether those mergers that would have been prohibited under the old standard (pre-1968) are anticompetitive. Results indicate that enforcement of the Clayton Act against horizontal mergers remained vigorous in the manufacturing sector.
ISSN:0003-603X
1930-7969
DOI:10.1177/0003603X9003500306