15 November 2002

Switching Costs and Merger Assessment – don’t move the goalposts

RBB Brief 6 analyses the effect that switching costs have on the appraisal of mergers:. Too often, the existence of switching costs is cited as a reason for prohibiting mergers at lower levels of market concentration than would normally be justified. The real impact of switching costs, however, is rather more complex, and can lead to surprising results…

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