Motta, MassimoTarantino, EmanueleUniversitat Pompeu Fabra. Departament d'Economia i Empresa2018-02-142018-02-142017-08-30http://hdl.handle.net/10230/33874It has been suggested that mergers, by increasing concentration, raise incentives to invest and hence are pro-competitive. To study the effects of mergers, we rewrite a game with simultaneous price and cost-reducing investment choices as one where firms only choose prices, and make use of aggregative game theory. We find no support for that claim: absent efficiency gains, the merger lowers total investments and consumer surplus. Only if it entails sufficient efficiency gains, will it be pro-competitive. We also show there exist classes of models for which the results obtained with cost-reducing investments are equivalent to those with quality-enhancing investments.application/pdfengL'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative CommonsThe effect of horizontal mergers, when firms compete in prices and investments<resourceType xmlns="http://datacite.org/schema/kernel-3" resourceTypeGeneral="Other">info:eu-repo/semantics/workingPaper</resourceType><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">horizontal mergers</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">innovation</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">investments</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">network-sharing agreements</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">competition.</subject><subject xmlns="http://datacite.org/schema/kernel-3" subjectScheme="keyword">Business Economics and Industrial Organization</subject><rights xmlns="http://datacite.org/schema/kernel-3">info:eu-repo/semantics/openAccess</rights>