| Abstract: | This paper considers the role that merger simulation modelsshould play in European merger control. The use of these models,as off-the-shelf instruments to assess the economic effectsof mergers, has become increasingly widespread in recent years.However, contrary to some claims, merger simulation models donot allow investigators to avoid much of the competitive effectsanalysis relating to the relevant economic market, nor do theynecessarily provide more precision to merger control. Withoutunderstanding the limitations of such models and the circumstancesunder which they can and should be usefully applied, they maynot just be useless, but dangerous in the sense of providingpossibly spurious results with spurious claimed accuracy. Thispaper argues that any merger simulation models used should be"bespoke" models, rather than off-the-shelf models, but cautionsthat even bespoke models will frequently not be as useful asis often claimed. This is not to deny that there are occasionswhen well-constructed bespoke models are genuinely useful anddo offer genuine improvements in merger control. |
