The Effects of M&A on Efficiency and Markup Power

The video discusses mergers and acquisitions in the manufacturing sector, focusing on the expected profitability from efficiency gains and market power. The study examines US manufacturing from 1997 to 2007, finding significant markup effects but little evidence of efficiency gains. The implications for antitrust authorities are considered, especially concerning horizontal and vertical mergers. The potential application of these findings to the service sector is also explored.

What implications do the findings of the study have for antitrust authorities?

In what ways do horizontal and vertical mergers differ in terms of market power effects?