Article Abstract:
The differences between price and marginal cost in particular cement markets directly correlate to the amount of multimarket contact among producers in the said market. The US cement industry, which has exhibited a penchant for antitrust dispute considering its consolidation, provided the data for 25 regional markets studied over 16 years. The direct relation between multimarket contact and pricing and marginal cost has implications on merger policies which are generally designed to ensure fair play in the market.
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Article Abstract:
The successful merger of a number of small firms in a market will allow them to raise the prices of their goods. That move, however, will result in the expanded output by firms outside of the suddenly dominant merged firms and a subsequent decrease in market share. The hypothesis was tested using data from the post-1974 cement industry of Toronto, Ontario. The findings indicate a negative effect on the market price brought about by consolidation.
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Article Abstract:
Research is presented concerning the evaluation of the predictions made by J. Haltiwanger and J.E. Harrington Jr. in a paper entitled "The Impact of Cyclical Demand Movements on Collusive Behavior" as it applies to the portland cement industry.
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