Dynamic efficiencies of the 1997 BoeingMcDonnell Douglas merger Academic Article

abstract

• AbstractWe evaluate the welfare effects of the 1997 BoeingMcDonnell Douglas merger in the mediumsized, widebody aircraft industry. We find that the merger led to lower prices. To explain the price drop, we develop a dynamic oligopoly game with learningbydoing. We quantify the welfare effects of the merger by incorporating both increased market power and merger efficiencies from accelerated learningbydoing. Our dynamic analysis indicates that net consumer surplus increased by as much as $5.14 billion, whereas a static model ignoring efficiencies of learningbydoing predicts a $0.92 billionloss.

authors

• An, Yonghong

published proceedings

• The RAND Journal of Economics

altmetric score

• 1

author list (cited authors)

• An, Y., & Zhao, W.

citation count

• 3

publication date

• September 2019

publisher

• Wiley  Publisher

keywords

• 38 Economics
• 3801 Applied Economics

Digital Object Identifier (DOI)

• 10.1111/1756-2171.12291

start page

• 666

end page

• 694

volume

• 50

issue

• 3

URL

• http://dx.doi.org/10.1111/1756-2171.12291