Cost Asymmetric Corporate Level Merging Of Market Equilibrium And Social Welfare Analysis

In recent years, our country has appeared many enterprise horizontal merger cases, which has become a common phenomenon in the market. Some horizontal merger between large enterprises in some industries affects the industry structure and the profit distribution of the market. Based on the former research on the background of Cournot model, this paper makes the detailed analysis of the impact of the fixed cost and variable cost on enterprises horizontal merger during the short production cycle. This paper mainly adopts the way of model establishment, regards the short production in economics as the background, analyses the market equilibrium and social welfare of the enterprise merger by the way of the fixed cost and variable cost. And, in this paper, the results of theoretical research are applied to the existing industry structure division of the labor-intensive, capital-intensive and technology-intensive. In the end, the results of this paper provide the advice for different kinds of industry horizontal merger to make profits. The research conclusion of this paper shows that the companies should meet certain conditions in order to make profits by the way of horizontal merger. The certain conditions is that the merger enterprises should have the larger fixed cost gaps and smaller variable cost gaps in the higher variable cost and the lower fixed cost industry, and the merger enterprises should have the smaller fixed cost gaps and larger variable cost gaps in the lower variable cost and the higher fixed cost industry.