Economics at the FTC: Horizontal Mergers and Data Security

This article describes aspects of the economic analyses that were performed on three matters on which economists in the Bureau of Economics at the Federal Trade Commission have worked during this past year. The first two matters were merger investigations: They (separately) involved tobacco manufacturers and food distributors. While these investigations shared some common attributes, such as the importance of the proposed divestitures, this essay demonstrates how our analysis must vary based on the types of information and the competitive concerns presented by specific transactions. The third section discusses a general economic approach to estimating consumer harm from data breaches, which is illustrated with an example of an application to a recent case.