DP10959 Effective European Antitrust: Does EC Merger Policy Generate Deterrence
Author(s): | Joseph A. Clougherty, Tomaso Duso, Miyu Lee, Jo Seldeslachts |
Publication Date: | November 2015 |
Keyword(s): | competition policy, deterrence, European Commission, merger policy |
JEL(s): | K21, K40, L40 |
Programme Areas: | Industrial Organization |
Link to this Page: | cepr.org/active/publications/discussion_papers/dp.php?dpno=10959 |
We estimate the deterrence effects of European Commission (EC) merger policy instruments over the 1990-2009 period. Our empirical results suggest that phase-1 remedies uniquely generate robust deterrence as ? unlike phase-1 withdrawals, phase-2 remedies, and preventions ? phase-1 remedies lead to fewer merger notifications in subsequent years. Furthermore, the deterrence effects of phase-1 remedies work best in high-concentration industries; i.e., industries where the HHI is above the 0.2 cut-off level employed by the EC. Additionally, we find that phase-1 remedies do not deter clearly pro-competitive mergers, but do deter potentially anti-competitive mergers in high-concentration industries.