Study: Google Would Raise DoubleClick Prices
By David A. Utter

A Senate Judiciary subcommittee hearing on the Google and DoubleClick merger takes place later today. SSRN fanned the flames of antitrust controversy by publishing its study ahead of the hearing.

Robert W. Hahn, AEI-Brookings Joint Center for Regulatory Studies, and Hal Singer, Criterion Economics, found the arguments in favor of the merger don't hold up under scrutiny. One part of their paper considered the impact of all the consumer behavior data Google would receive from DoubleClick in the acquisition (spacing added for clarity):

If consumer data generates increasing returns to scale, as some academics have asserted, Google would extend their lead in search ads and possibly also their new position in graphic ads.

Google’s acquisition of more data would also increase the barrier to entry faced by new entrants, as well as putting current competitors at an even greater competitive disadvantage.

To the extent that Google’s rivals are impaired in their ability to compete effectively, the price of online advertising could increase further.

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