Redkina, A. Yu. & Maltseva, T. V. (2019). Game-theoretical modeling of business merger control. Zhurnal Economicheskoj Teorii [Russian Journal of Economic Theory], 16(1), 91-100
The paper deals with the problem of the occurrence of errors of the second type (erroneous transaction approval) when regulating economic concentration transactions. The purpose of antitrust regulation in this case is to prevent transactions detrimental to competition. Each transaction could, on the one hand, lead to a price increase due to the strengthening of monopoly power; on the other hand, generate a synergistic effect in the form of lower marginal costs. The difficulty lies in the fact that the antimonopoly authority may not be completely informed about the magnitude of such an effect. A game-theoretic model in which firms interact according to the Cournot model has been chosen for the simulation. If competition authority is able to observe the level of synergy merger, type II errors do not occur. In case of imperfect information, synergy would define the probability of a type II error.