Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
Improving Economic Analysis in Merger Guidelines
Journal of Economic Perspectives
vol. 39,
no. 1, Winter 2025
(pp. 29–52)
(Complimentary)
Abstract
Merger review should reflect basic precepts of decision analysis, best practices in industrial organization economics, and teachings from related fields. Unfortunately, the analytical methods in modern merger guidelines fall short. Protocols violate standard prescriptions for information collection and decision-making, rely on a market definition paradigm that deviates significantly from core models of competitive interaction, fail to leverage central advances in understanding the efficiency consequences of mergers, and contravene or ignore fundamental dynamics relating to entry. This article elaborates correct analysis and contrasts it with that embodied in modern merger guidelines generally employed throughout the developed world, including the 2023 Merger Guidelines revision in the United States.Citation
Kaplow, Louis. 2025. "Improving Economic Analysis in Merger Guidelines." Journal of Economic Perspectives 39 (1): 29–52. DOI: 10.1257/jep.20241413Additional Materials
JEL Classification
- G34 Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
- G38 Corporate Finance and Governance: Government Policy and Regulation
- K21 Antitrust Law
- L40 Antitrust Issues and Policies: General
- N42 Economic History: Government, War, Law, International Relations, and Regulation: U.S.; Canada: 1913-