TY  - JOUR
AU  - Nocke,Volker
AU  - Whinston,Michael D.
TI  - Dynamic Merger Review
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14526
PY  - 2008
Y2  - December 2008
UR  - http://www.nber.org/papers/w14526
L1  - http://www.nber.org/papers/w14526.pdf
N1  - Author contact info:
Volker Nocke
Department of Economics
University of Mannheim
68131 Mannheim
Germany
Tel: +49-0621-1811836
E-Mail: nocke@uni-mannheim.de

Michael D. Whinston
Department of Economics
Northwestern University
2003 Sheridan Road
Evanston, IL  60202
Tel: 847/491-8260
Fax: 847/491-7001
E-Mail: mwhinston@northwestern.edu
AB  - We analyze the optimal dynamic policy of an antitrust authority towards horizontal mergers when merger proposals are endogenous and occur over time. Approving a currently proposed merger will affect the profitability and welfare effects of potential future mergers, the characteristics of which may not yet be known to the antitrust authority. We show that, in many cases, this apparently difficult problem has a simple resolution: an antitrust authority can maximize discounted consumer surplus by using a completely myopic merger review policy that approves a merger today if and only if it does not lower consumer surplus given the current market structure.
ER  -