Market data and participants’ views in horizontal merger analysis

Merger analysis draws inferences from quantitative study of market data, and it does so in several ways whose contrasts are often stressed. But it also draws inferences from the views of customers and other participants. Both types of inference are valuable, and they are used together more often than separately, as neither one is clearly more reliable than the other. Differences between types of evidence are a strength of an overall enquiry, when evidence is used together, and it is not necessarily productive to try to make either more like the other.

1. Merger review at the US antitrust agencies considers, as the 2010 Merger Guidelines put it, “any reasonably available and reliable evidence.” [1] The Guidelines devote Section 2 to illustrating the variety of such evidence. Of course one could divide the kinds of evidence in various ways; this article stresses one such broad division. We draw inferences from market data such as prices, costs, quantities, demand estimates, and the like, using our own analytical apparatus and doing our own modeling or calculations; we also draw inferences from the testimony, documents, and views of market participants, which might in turn rest on their formal or (more often) informal analysis of facts, data, experience, and judgment. I. Inferences from market data 2. When useful data are available, we

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  • University of Berkeley


Joseph Farrell, Market data and participants’ views in horizontal merger analysis, May 2012, Concurrences Review N° 2-2012, Art. N° 45416, pp. 21-26

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