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The 2010 HMGs Ten Years Later: Where Do We Go From Here?

Authors
  • Salop, Steven C.1
  • Morton, Fiona Scott2
  • 1 Georgetown University Law Center,
  • 2 Yale University School of Management,
Type
Published Article
Journal
Review of Industrial Organization
Publisher
Springer US
Publication Date
Jan 09, 2021
Pages
1–21
Identifiers
DOI: 10.1007/s11151-020-09809-4
PMID: 33456134
PMCID: PMC7794629
Source
PubMed Central
Keywords
Disciplines
  • Article
License
Unknown

Abstract

In this article, which is part of the Symposium on the Tenth Anniversary of the 2010 Horizontal Merger Guidelines, we suggest a number of improvements that should be considered in the next revision of the Guidelines. Our analysis is based on the observation that horizontal merger policy has suffered from under-enforcement. We provide evidence that the enforcement agencies face significant resource constraints that require a triage process that inevitably leads to under-enforcement. In light of merger law placing greater weight on avoiding false negatives and under-deterrence than false positive and over-deterrence, the article suggests a number of ways in which the under-enforcement bias might be corrected, including (among others): rolling back the increase in the HHI “red zone” thresholds; mandating anticompetitive presumptions for mergers with high GUPPIs, acquisitions of mavericks, and acquisitions by dominant firms; closer analysis of common ownership by financial funds; and expanded analysis of potential competition mergers.

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