Economics at the FTC: Retrospective Merger Analysis with a Focus on Hospitals

Abstract

Antitrust, Consumer protection, FTC, Mergers, Merger retrospectives,

The Evolution of Quantitative Food Marketing Policy: A Public Perspective

“…If one can locate a similarly situated market, possibly with the same firms and brands, where the merger did not occur, then identification of an anti-competitive effect can be even stronger: if a merger increases price in the affected market but not in the control market, one has double confirmation. FTC economists recently used this differ-ence-in-differences approach to examine, ex post, several mergers (Farrell, Pautler, and Vita 2009). Such evidence assembled over time for specific industries such as food retailing or specific food manufacturing industries can serve as a very direct economic yardstick for merger review.…”

Revealed Growth: A Method for Bounding the Elasticity of Demand with an Application to Assessing the Antitrust Remedy in the Du Pont Decision

“…S. Federal Trade Commission (1999), examining the efficacy of divestiture remedies accompanying merger approvals from 1990-94; Farrell, Pautler, and Vita (2009), describing a similar FTC exercise focusing on a sample of hospital mergers; and U.S. Federal Trade Commission (2017), studying all 89 FTC merger orders from 2006-12. This last study judged remedies to be at least a qualified success in 83% of cases.…”

Can mergers increase output? Evidence from the lodging industry

“…However, there are particular circumstances where the standard predictions do not apply (e.g., Froeb, Tschantz, and Crooke, ) and evidence on mergers remains thin. This has led to calls for more and better empirical work, especially from those who work at the enforcement agencies, for example, Froeb et al (), Carlton (), Farrell, Pautler, and Vita (), and Bailey (). These policy makers want enough data on mergers, and enough variation across observed merger effects, to determine which theoretical model should be used to evaluate the competitive effects of a particular merger in a particular industry (FTC, 2005).…”

“…Werden, Joskow, and Johnson () estimate the effects of the Northwest/Republic airline merger; and Farrell, Pautler, and Vita () report on hospital mergers.…”