Tag Archives: competition and monopoly

Wonder if @NZComCom shared this conclusion back then about successful browser monopolization?

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Anti-competitive mergers make little sense to me

There are two main arguments against mergers and acquisitions. The first of these is that they are paper shuffling with little in the way of cost advantages. The second is they allow the combined firm to raise its prices because it faces less competition.

I find these arguments to be in direct contradiction. Anti-competitive mergers must be high risk venture if there is little in the way of cost savings. Two previously efficient firm sizes are disturbed permanently in the hope of some ability to raise prices in the future without provoking too much new entry or expansion from the competitive fringe.

It is far better just to keep on colluding or just compete rather than risk permanently damaging the efficient operation of both firms.

Milton Friedman on the essence of the Age of the Worker