Non-Price Effects of Mergers

• Date: 01 June 2018
• Author: Diana L. Moss,Gregory T. Gundlach
• Published date: 01 June 2018
• DOI: 10.1177/0003603X18770067

Article

Non-Price Effects of Mergers:

Introduction and Overview

Gregory T. Gundlach* and Diana L. Moss**

Abstract

Mergers may impact price as well as non-price forms of competition in the form of product quality,

variety, service, and innovation. This special issue of the Antitrust Bulletin examines the increasing

importance of non-price dimensions of competition in merger analysis, the challenges that non-price

effects pose for antitrust merger enforcement, and approaches for enhancing the analysis and role of

non-price competition in merger enforcement decisions and competition policy responses. This is a

critical discussion that informs the debate over the importance and adequacy of the consumer welfare

standard, which is the prevailing standard for evaluating the competitive effects of mergers and

nonmerger conduct.

Keywords

mergers, non-price competition, competition policy, effects, quality, service, variety, choice,

innovation

I. Non-Price Competition and Effects

A. Non-Price Competition

Non-price competition involves activities by firms, excluding those associated with price, that alter

demand for the firm’s goods or services or those of their competitors.

1

The effects of such dynamics on

consumer welfare as the prevailing standard for evaluating competitive effects in U.S. competition

enforcement are attracting significant attention in the competition community. As a form of rivalry,

*University of North Florida, Jacksonville, FL, USA; and American Antitrust Institute, Washington, D.C., USA

**American Antitrust Institute, Washington D.C., USA

Corresponding Author:

Gregory T. Gundlach, University of North Florida, 1 UNF Drive, Jacksonville, FL 32224, USA.

Email: ggundlac@unf.edu

1. Michael Spence, Non-price Competition,67AM.ECON.REV. 255, 255 (1977) (“Non-price competition, ...refers to [non-

price] activities by firms or corporations that shift the demands for products, their own and those of their rivals.”). Stanley L.

Brue & Campbell J. R. McConnell, ECONOMICS –PRINCIPLES,PROBLEMSAND POLICIES 43.7–.8 (2002) (non-price competition is

a marketing strategy “in which one firm tries to distinguish its product or service from competing products on the basis of

attributes like design and workmanship”).

The Antitrust Bulletin

2018, Vol. 63(2) 155-168

ªThe Author(s) 2018

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DOI: 10.1177/0003603X18770067

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