8) An additional result noted in Panel A is that allied targets in horizontal mergers
have higher premiums than their nonallied counterparts, with significant mean and median differences (p-value = 0.
The Merger Guidelines apply the standard horizontal merger
framework to the acquisition of a firm that is outside the market but committed to entering.
The upshot of Kaplow's paper is a strong recommendation that antitrust analysis abandon market definition altogether, (57) a position taken with somewhat less force in the Horizontal Merger
Guidelines (58) and apparently likely to show up soon, at least as to merger analysis, in the influential Areeda Antitrust Law treatise.
A horizontal merger
among sellers reduces reported production capacity, increases price, and decreases output.
It remains to be seen if horizontal cooperation is an intermediate step towards market concentration by means of horizontal mergers
, or an organizational structure that is also sustainable in the long run.
Whether horizontal mergers
among hospitals lead to greater negotiating leverage and higher prices remains a hotly contested issue.
United States Department of Justice and Federal Trade Commission Horizontal Merger
Guidelines [section] 4 (rev'd 4/8/97).
For a discussion of Judge Posner's incomplete treatment of the FTC's successful challenge to the Staples-Office Depot merger, which was based in part on econometric analysis of pricing data, see Jonathan Baker, Horizontal Merger
Analysis Grows Up: A Review of Chapter Five of Richard Posner's Antitrust Law (2d ed.
In the case of horizontal mergers
, the combining firms may secure market power that will harm consumers; or the combining firms may exploit economic efficiencies that will benefit consumers.
Blair explains that with a horizontal merger
, the cost savings area are more easily seen.
In the early 1980s, the focus of merger analysis changed in the form of the Federal Trade Commission's (FTC) 1982 Statement Concerning Horizontal Mergers
and the DOJ's 1984 Merger Guidelines.
the industry uses a high fraction of its own output), then a horizontal merger
can also be classified as vertically related.