What are the effects of horizontal mergers on competition?

Horizontal mergers occur when two or more companies that are already selling similar products or services join forces in order to increase their market share. This can affect competition in several ways. Firstly, horizontal mergers can lead to increased prices for consumers. This is because the merged companies may have more bargaining power which they can use to force suppliers to accept higher prices for their inputs. This is likely to be passed onto consumers by increasing the prices of the companies’ goods and services. Secondly, horizontal mergers can lead to less choice for consumers as the new, combined company may have less impetus to innovate or expand its product range. This can also lead to higher prices as customers have fewer alternatives. Finally, horizontal mergers can also reduce the level of competition in the marketplace. This is because the fewer companies in the market, the less incentive there is for any of them to compete. This, in turn, can reduce innovation and investments in research and development. In Nebraska, the law is complicated and like most states, many of the antitrust laws are general in nature and do not specifically address horizontal mergers. However, the federal government has jurisdiction over antitrust cases, and the Department of Justice can prosecute companies for violations of the antitrust laws.

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What are the effects of horizontal mergers on competition?

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