FTC Hart-Scott-Rodino Merger Enforcement Decision Predictor for reasonably strong cases
The model uses data on the Herfindahl index, an indicator variable (0 or 1) for efficiencies, a count of the number of complaints and an estimate of the number of key issues (concentrated market, barriers to entry and anticompetitive theory for merger) on which the Commission's Bureau of Competition (BC) and Bureau of Economics (BE) may differ. The share of the transaction involved in the competitive overlap is an optional variable.
Click on open cells to input parameters into javascript program, then obtain estimates of the probability of FTC enforcement action by clicking on calculate statement. (Click on the variable for more information.)
The model uses publically released coefficient estimates contained in Coate(1999).
Note: the model assumes that BC reports both barriers are high and an anti-competitive theory exists. In general, if parties convince BC staff that either entry is easy (no barriers) or no anticompetitive theory exists to generate a concern, the investigation will close.
Assuming statistical independence, the overall probability of enforcement action is defined by taking the probability that a colorable case exists and multipling by the probability of enforcement action generated above. In a number of cases, the probability of a colorable concern is one and thus the model generates the probability of enforcement action.