Gatsios, Konstantine; Karp, Larry S - In: Journal of Industrial Economics 40 (1992) 3, pp. 339-48
If capital lowers marginal cost and a firm with more capital gets a bigger share of the surplus in merger bargaining, then the equilibrium price with a merger may be lower than without a merger. If entry is restricted, the level of industry profits minus investment costs may be higher if mergers...