Elena Argentesi, Paolo Buccirossi, Emilio Calvano, Tomaso Duso, Alessia Marrazzo, Salvatore Nava, 04 March 2020

Dominant companies in the digital market may use merger and acquisitions – especially ‘killer’ or ‘zombie’ acquisitions – and the (under)enforcement of merger control to stifle competition and cement their market dominance. This column analyses acquisition activity by Amazon, Facebook, and Google between 2008 and 2018, and finds that they often targeted very young firms. Because the evolution of young firms is still uncertain, it is difficult for competition authorities to assess the effects of these mergers, especially when the focus is on single acquisitions without considering the overall acquisition strategy.


The intensive course in Competition in Digital Markets will be held at the Barcelona GSE from November 20 to 22, 2019. This course offers the opportunity to understand how the digital economy works, and under what conditions competition may not function as it should in this sector. It provides participants with a thorough understanding of how to evaluate the substitutability between different offerings and when to view practices such as tying, exclusive contracts, price-parity clauses, and discriminatory access to platforms as anti-competitive (but also explain in what circumstances they are likely to be beneficial).

Course lecturers includes leading international competition scholars and practitioners with extensive experience of the application of economic techniques to competition cases in this area:

Giulio Federico (Head of Unit, CET, DG Competition European Commission)

Chiara Fumagalli (Associate Professor of Economics, Bocconi University)

Massimo Motta (Professor of Economics, ICREA-UPF and Barcelona GSE; former Chief Competition Economist, European Commission) - course director

Martin Peitz (Professor of Economics, University of Mannheim)

An Early Bird discount will be offered to participants confirming their attendance before October 20. A reduced course fee is also available to Regulators, Competition Authorities, Academics and Barcelona GSE Alumni.

Ross Levine, Chen Lin, Zigan Wang, 26 June 2017

While the causes and consequences of mergers have received a lot of scholarly attention, geographic factors have thus far been neglected. Using US data, this column argues that greater geographic overlap of the subsidiaries and branches of two bank holding companies increases the likelihood of the two merging, and also boosts the cumulative abnormal returns of the acquirer, target, and merged companies. It also discusses how network overlap can affect synergies and value creation.

Marco Becht, Andrea Polo, Stefano Rossi, 20 July 2016

Many corporate acquirers impose losses on their shareholders. Conflicted or overconfident CEOs and boards embark on acquisitions that are not in the best interest of the owners of the firm. The governance tool of shareholder voting can represent a potential solution. This column shows that in the UK, where bids for relatively large targets require mandatory shareholder approval, shareholders gain when the transaction is conditional on a vote and lose when it is not. The evidence suggests that the vote puts a constraint on the amount the CEO can offer for the target.

Rui Albuquerque, Miguel Ferreira, Luis Brandao-Marques, Pedro Matos, 17 January 2016

Previous research has shown that the corporate governance practices of firms are constrained by the legal standards of their country of incorporation. This column explores how an active international market for corporate control can substitute for weak institutions in a host country. Using firm-level data from 22 countries, it shows how cross-border M&A activity improves the governance of non-target firms in the same industry, via peer pressure. These findings provide evidence for corporate governance improvements as a novel positive spillover from FDI.

Duarte Brito, Ricardo Ribeiro, Helder Vasconcelos, 28 September 2013

Horizontal acquisitions affect prices through two channels: by eliminating competition between the firms involved, and by changing the incentives for collusion in the affected industry. This column summarises recent research that quantifies these two effects using a new methodology – one that accounts for the difference between financial interests and corporate control. A study of the disposable-razor industry shows that small firms have the greatest incentive to undercut pricing agreements. After acquisitions, acquiring firms have greater incentives to collude, whereas other firms in the industry are more likely to defect.

Viral Acharya, Tim Johnson, 11 March 2008

Suspicious trading activities ahead of major mergers and acquisitions have raised concerns about insider trading in recent years. New research attributes the rise in insider trading to the growing number of insiders involved in big deals.


CEPR Policy Research