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Making European Merger Policy More Predictable analyses European Merger Control with regard to its capacity to generate predictability among the concerned parties. Starting from the premise that predictability is of overwhelming importance for the functioning of market economies, Voigt and Schmidt ask to what degree European Merger Control has been predictable over the last couple of years. The authors show both theoretically and empirically that there have been serious shortcomings with regard to the predictability of competition policy. They identify the insufficient recognition of the consequences of globalization on the competitive processes as well as an often inconsistent application of economic theory as the root causes for the lack of predictability. The inconsistent application of economic theory is particularly relevant with regard to potential competition and the evaluation of collective dominance. The authors generate a substantial number of proposals that could help to improve predictability. On this basis, Voigt and Schmidt critically assess the recent reforms of European Merger Control.

Making European Merger Policy More Predictable

Chapter 1. Predictability as a Crucial Condition for Economics Growth and Development 1. Introductory Remarks. 2. Some Theoretical Consideration Concerning Predictability. 3. Some Empirical Results Concerning Predictability. 4. The Predictability of European Merger Policy. 5. Proposals for Improving Predictability. Chapter 2. Development in Competition Theory. 1. Introductory Remarks. 2. The Harvard Approach. 3. The Chicago Approach. 4. Contestability Theory. 5. The Contribution of Game Theory: the New Industrial Organization. 6. The Contribution of the New Institutional Economics: Transaction Cost Economics. 7. In lieu of a Summary: Consensus and Dissensus Between the Various Approaches. Chapter 3. Trends in the Business Environment. 1. Liberalisation as a Driving Force of Globalisation. 2. Economic and Technical Factors. 3. Conclusions. Chapter 4. Possible consequences of Trends in Theory (B) and Developments in Business (C) for Competition Policy. 1. Introduction. 2. From Market Definition to Assessing Dominance. 3. A Closer Look at Barriers to Entry and Contestability. 4. Assessing Collective Dominance. Chapter 5. Case Studies. 1. Assessment of Barriers to Entry in European Merger Control: The Cases of Volvo/Scania, Mercedes-Benz/Kässbohrer, and MAN/Auwärter. 2. Assessment of Barriers to Entry in European Merger Control: The Cases of SCA/Metsä Tissue and SCA Hygiene Products/ Cartoinvest. 3. Assessment of Barriers to Entry in European Merger Control: The Case of BASF/Bayer/Hoechst/Dystar.4. Assessment of Barriers to Entry in European Merger Control: The Markets for Telecommunications in the Case of Telia/Telenor. 5. Collective Dominance under the European Merger Regulation. Chapter 6. Practical Proposals. 1. Introductory remarks. 2. Overview of Substantive proposals as Developed in Chapter 4. 3. Procedural Proposals. 4. Conclusions and Outlook. Appendix. Endnotes. References. Index.