This paper analyzes the impact of a merger in the French supermarket industry
on food prices. Using consumer panel data, we compare the changes in prices
for merging and rival firms in affected and comparison markets. We use a novel
definition of affected markets when some firms have a local pricing strategy and
others a more centralized pricing strategy. We find that prices increase significantly
following the merger, and that the merging firms lose market shares. For the rivals,
the price increases are larger in local markets, in which concentration increased and
differentiation changed after the merger.

Keywords: Ex-post merger evaluation, Retail sector.
JEL Classification: K21; L11; L66.