Mergers

Paper Summary:

This paper examines the growing number of company mergers that have been taking place in a variety of different industries and discusses the negative consequences of such mergers for the consumer. The paper also discusses the benefits many of these merged companies claim are passed on to the consumer as a result of the merger.

From the Paper:

"Businesses merge for a number of reasons, and the government takes an interest in mergers because if an industry becomes too concentrated, the public suffers from a lack of competition. For that matter, economists would note that business suffers as well when there is a lack of competition, given that too much freedom can alienate customers and create a moribund business organization. The concerns of critics are greater for some types of business than for others. Different sorts of retail establishments merge and may create concerns about high prices because of a lack of competition, or some other problem for the consumer faced with a lack of choice. Telecommunications and media mergers raise even more flags because of the many efforts over the years to prevent monopolies in these areas, with greater concentration seen as limiting choices for the public in damaging ways. Yet, such mergers continue, creating huge companies that claim to offer better service and more choice because of their size, while critics worry that such mergers are creating monopolies that will soon dictate terms and prices."

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