Mergers Raise Prices, Not Efficiency
“So it looks like mergers, at least in recent years in the manufacturing industry, let companies make more profits by raising prices, not by being more efficient. That’s bad news for consumers, and for the economy in general.
“The implication is that the U.S. needs to get more serious about antitrust. While it’s true that technological network effects and intellectual property are more important sources of market power than in decades past, that doesn’t mean antitrust is obsolete. The acceleration of mergers, amid evidence that all they do is push up consumer prices, implies that U.S. antitrust authorities should be doing more to combat concentration of market power, not less.”
The main argument for letting big companies combine isn’t supported by the data.
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