Horizontal effects are the anti-competitive consequences of mergers where the competitive constraints existing before the transaction between the merging parties are eliminated (unilateral or non-coordinated effects), and/or the post-merger market structure reduces the intensity of competition between the remaining competitors (pro-collusive or coordinated effects).
Non-coordinated effects refer to a situation where, post-merger, the merging parties are able to profitably increase prices, reduce output, or otherwise act less competitively than before, while their rivals do notalter their strategies. Non-coordinated effects arise from the independent profit maximization of the individual firms and are due to the internalization of competition between the merging firms. Before the merger, a unilateral price increase by one party would have led to sales lost to competing firms, including the other merging party. As a result of the merger, the parties can...
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