THE EFFECTS OF HORIZONTAL MERGERS ON COMPETITION - THE CASE OF THE NORTHERN-SECURITIES-COMPANY

Several recent articles have studied the competitive effects of horizo ntal mergers by examining rival firms' stock price reactions to the me rger announcement and subsequent antitrust challenge. These articles h ave consistently failed to find any evidence for of anticompetitive ef fects. This article considers two alternative explanations for the pre vious findings, and it sheds some new light on the issue by presenting a case study of the merger that resulted in the formation of the Nort hern Securities Company in 1901.