# Anticompetitive Effects of Common Ownership

“Anticompetitive Effects of Common Ownership” (2018), by José Azar et al. Business and Management research paper. Original abstract below, unchanged. No free PDF was found.

- Authors: José Azar, Martin C. Schmalz, Isabel Tecu
- Published: May 25, 2018
- Field: Business and Management
- DOI: https://doi.org/10.1111/jofi.12698
- Source: https://doi.org/10.1111/jofi.12698

## Abstract

Many natural competitors are jointly held by a small set of large institutional investors. In the U.S. airline industry, taking common ownership into account implies increases in market concentration that are 10 times larger than what is “presumed likely to enhance market power” by antitrust authorities. Within‐route changes in common ownership concentration robustly correlate with route‐level changes in ticket prices, even when we only use variation in ownership due to the combination of two large asset managers. We conclude that a hidden social cost—reduced product market competition—accompanies the private benefits of diversification and good governance.

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