Journal of Industry, Competition and Trade

, Volume 18, Issue 3, pp 373–394 | Cite as

Sequential Mergers and Antitrust Authority’s Decisions in Stackelberg Markets

  • Mariana CunhaEmail author
  • Hélder Vasconcelos


This paper analyses a sequential merger formation game in a setting where: (i) firms compete à la Stackelberg; (ii) mergers may give rise to endogenous efficiency gains; and (iii) every merger has to be submitted for approval to the Antitrust Authority (AA). Two different types of AA are studied: first, we assume a myopic AA, which accepts or rejects a given merger without considering that this merger may be followed by other mergers; and, second, a forward looking AA, which anticipates the final industry structure a merger will give rise to, if approved. We conclude that these two types of AA adopt similar decisions whenever a merger would not trigger the exit of outsider firms. Their decisions are, however, shown to be very different when evaluating exit-inducing merger proposals.


Mergers Myopic versus forward-looking merger control Stackelberg 

JEL Classification

L13 D43 L40 L41 



Financial Support from Fundação para a Ciência e Tecnologia (SFRH/BD/70000/2010) is gratefully acknowleged.


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© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Católica Porto Business School and CEGEUniversidade Católica PortuguesaPortoPortugal
  2. 2.CEF.UP and Faculdade de EconomiaUniversidade do PortoPortoPortugal

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