The U.S. Supreme Court and the Merger Efficiency “Defense”
Document Type
Article
Publication Date
7-14-2025
Abstract
Firms’ principal motives for merging are not to increase market power, but rather to improve firm outcomes through changes in internal operations or structure. Of the 17000+ mergers that occur annually in the U.S., 90% or more have no expectation of an anticompetitive price increase or output reduction. They can profit only by better performance. As a result, the way that we analyze mergers puts the cart before the horse. Rather than using an efficiency “defense” to a prima facie unlawful merger, we should consider how the merger affects a firm’s operations and performance. That is in fact the position that the Supreme Court has taken in its analysis of merger efficiencies.
Publication Title
Network Law Review
Repository Citation
Hovenkamp, Herbert, "The U.S. Supreme Court and the Merger Efficiency “Defense”" (2025). Articles. 583.
https://scholarship.law.upenn.edu/faculty_articles/583