Department   Undergraduate School  , School of Commerce
   Position   Professor
Language English
Publication Date 2019/12
Type Academic Journal
Peer Review Peer reviewed
Title "Sequential Mergers and Competition Policy under Partial Privatization", Australian Economic Papers
Contribution Type Co-authored (first author)
Journal Australian Economic Papers
Journal TypeAnother Country
Publisher Wiley
Volume, Issue, Page 58(4),pp.375-397
Author and coauthor Takeshi Ebina and Daisuke Shimizu
Details We examine optimal merger and privatisation policies in a partially privatised oligopoly with differentiated goods. We first show that under the subgame perfect Nash equilibrium, sequential mergers either emerge completely or do not emerge at all. Given this outcome, we derive the following policy implications. First, the level of social welfare can be U‐shaped with respect to the number of merged firm pairs. That is, given that there are some mergers that have already taken place, further mergers may actually lead to welfare improvement. However, these welfare‐improving mergers may not be privately profitable, implying that merger‐friendly policies are appropriate. Second, policymakers can halt privatisation in order to diminish the private incentive for further sequential (welfare‐deteriorating) mergers and improve welfare. Third, full nationalisation is never optimal unless the goods are homogeneous or independent.
URL for researchmap https://researchmap.jp/ebinatakeshi2010/