Publication detail

Efficiency of EU Merger Control in the 1990-2008 Period

Author(s): PhDr. Goran Serdarević M.A.,
prof. PhDr. Petr Teplý Ph.D.,
Type: IES Working Papers
Year: 2009
Number: 28
ISSN / ISBN:
Published in: IES Working Papers 28/2009
Publishing place: Prague
Keywords: merger control, European Union, political economy, regulatory reform, PROBIT model
JEL codes: L4, K21, C25, D78
Suggested Citation: Serdarević, G., Teplý, P. (2009) “ Efficiency of EU Merger Control in the 1990-2008 Period ” IES Working Paper 28/2009. IES FSV. Charles University.
Grants: GACR 402/08/0004 (2008-2010) Model of Credit Risk Management in the Czech Republic and its Applicability in the EU Banking Sector GAUK 114109 (2009-2011) Alternative Approaches to Valuation of Collateralized Debt Obligation IES Research Framework Institutional task (2005-2011) Integration of the Czech economy into European union and its development
Abstract: The main goal of this paper is to provide an analysis of key regulatory changes in the European merger control and to evaluate their real impact on the efficiency of merger regulation. Our main contribution is an empirical analysis of a unique representative sample of 161 horizontal mergers covering the final regulatory assessments during the period from 1990 to 2008. We use stock market data to identify those cases where there are discrepancies between the Commission and market evaluation of the merger. The PROBIT model is then used to further investigate the sources of these discrepancies. Our results suggest that the Commission’s decisions are not purely explained by the motive of protecting consumer welfare and that other political and institutional factors do play a role in setting policy. We did not find evidence that the Commission protects competitors at the expense of consumers and foreign firms. Moreover, we conclude that the regulatory reform introduced in 2004 has significantly enhanced efficiency of the European merger control. To the authors’ best knowledge, this paper is the first study using stock market data to evaluate an impact of the recent EU merger control.
Downloadable: WP 2009_28_Serdarevic, Teply

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