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How to make sensible merger policies?

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Merger policy is a topic of heated debate. At times, the rhetoric on both sides seems exaggerated. Some claim that, partially due to lax merger policy, industry concentration in the U.S. has dramatically increased, creating market power almost everywhere and thereby harming the U.S. economy. Some go even further and claim that mergers generally create no efficiencies and so are never beneficial to the economy. On the opposite side, others claim that a more aggressive antitrust policy will simply force us back into the dark ages of antitrust of the 1950s and 1960s. If merger policy is to be rescued from being used as a political football to get elected, someone has to take charge and figure out what the evidence shows about the impact of merger policy on the economy, and, in light of that determination, adjust merger policy if there is a need to do so. The economists at the FTC and Department of Justice are best suited to do so.

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