Sequential mergers and Antitrust Authority's decisions in stackelberg markets

Mariana Cunha*, Hélder Vasconcelos

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)


This paper analyses a sequential merger formation game in a setting where: (i) firms compete à la Stackelberg; (ii) mergers may give rise to endogenous efficiency gains; and (iii) every merger has to be submitted for approval to the Antitrust Authority (AA). Two different types of AA are studied: first, we assume a myopic AA, which accepts or rejects a given merger without considering that this merger may be followed by other mergers; and, second, a forward looking AA, which anticipates the final industry structure a merger will give rise to, if approved. We conclude that these two types of AA adopt similar decisions whenever a merger would not trigger the exit of outsider firms. Their decisions are, however, shown to be very different when evaluating exit-inducing merger proposals.
Original languageEnglish
Pages (from-to)373-394
Number of pages22
JournalJournal of Industry, Competition and Trade
Issue number3
Publication statusPublished - 1 Sept 2018


  • Mergers
  • Myopic versus forward-looking merger control
  • Stackelberg


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