TY - JOUR
T1 - Export orientation and domestic merger policy
T2 - Theory and some empirical evidence
AU - Clougherty, Joseph A.
AU - Zhang, Anming
PY - 2005/8
Y1 - 2005/8
N2 - Recent 'open-economy industrial organization' literature finds export orientation enhances the weight of post-merger international competitive gains, favouring lenient domestic merger policy. However, mergers seldom generate the 'significant synergies' supportive of international competitive gains. Since a joint-economies-of-production effect suggests domestic mergers tend to generate international competitive losses (not gains), export orientation favours strict (not lenient) domestic merger policy. We show how non-synergistic domestic mergers in the presence of international sales might reduce national welfare and incur stringent merger reviews. A panel data set of U.S. merger policy by manufacturing sector, 1990-2001, empirically supports export orientation, leading to strict merger policy.
AB - Recent 'open-economy industrial organization' literature finds export orientation enhances the weight of post-merger international competitive gains, favouring lenient domestic merger policy. However, mergers seldom generate the 'significant synergies' supportive of international competitive gains. Since a joint-economies-of-production effect suggests domestic mergers tend to generate international competitive losses (not gains), export orientation favours strict (not lenient) domestic merger policy. We show how non-synergistic domestic mergers in the presence of international sales might reduce national welfare and incur stringent merger reviews. A panel data set of U.S. merger policy by manufacturing sector, 1990-2001, empirically supports export orientation, leading to strict merger policy.
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U2 - 10.1111/j.0008-4085.2005.00302.x
DO - 10.1111/j.0008-4085.2005.00302.x
M3 - Review article
AN - SCOPUS:21944446775
SN - 0008-4085
VL - 38
SP - 778
EP - 806
JO - Canadian Journal of Economics
JF - Canadian Journal of Economics
IS - 3
ER -