2: SUMMARY SUMMARY BACKGROUND INFORMATION ON THE FIRMS AND MARKET BRIEF OVERVIEW OF THE ENTRY DETERRENCE AND EFFICIENCY GAINS MODELS THE FIRST MERGER ATTEMPT AND TRIAL PROCESS APPEALS OF BOTH PARTIES SECOND AND THIRD MERGER ATTEMPTS THE EVOLUTION OF THE MARKET AFTER DECISION
10: Competition and efficiency Model from Dusoet al. (2007): Main idea – we can measure gain in efficiency from merger (that is cost reduction) by competitors stock price reaction at the date of the merger announcement. This can be easily find from figure: CS-consumer surplus, П is profit: m for merge, c for competitors, e is cost reduction. Giulia Sargenti at Ryanair and Aer Lingus Merger Cases measured that price reaction in first days is insignificant, that means that efficiency gain is insignificant small. (The cost reduction was one of the main argument of Ryanair)
