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IO Economist working on competition, trade, taxes | Assistant Prof @NYUSternEcon | Affil Fellow @StiglerCenter https://www.felixmontag.com

Felix Montag

Bottom line: 👉Imports are a weaker check on mergers than they look 👉 Might want behavioral remedies on post-merger AD/CVD petitions For ProMarket, I wrote about the implications this should have for the EU Commission's Merger Guidelines: promarket.org/2026/06/11/t... 8/8

Felix Montag

Why would a merger raise the demand for tariffs? 👉 The merged firm now captures the tariff gains that used to go to its domestic rival. BUT it loses the option to cut its own costs by offshoring. So the net effect depends on how strong import competition is. 3/8

I estimate demand & supply to simulate how the merger changes profitability of tariffs for Whirlpool. Main result: when import competition is strong (i.e., when merger control counts on it) tariffs beat offshoring, and the merger more than doubles Whirlpool's tariff gains. 5/8

Take Whirlpool-Maytag. The US cleared it in 2006, citing foreign competition. Washer imports then surged: from 30% of the market in 2005 toward 55% by 2010. So Whirlpool petitioned: tariffs on washers from Korea & Mexico (2011), China (2015), a global safeguard (2018). 4/8

New paper: "Mergers and the Demand for Protectionism" When does approving a merger risk undoing the import competition that justified the approval? Paper: felixmontag.com/files/2026_M... CEPR DP: cepr.org/publications... Short 🧵 1/8

The annual merger-induced consumer harm from the tariff (i.e., additional harm vs. tariff harm without merger) is comparable to the merger's market-power effect. 6/8

Flip side: a cross-border merger (Whirlpool-LG) does the opposite. A tariff hurts the firm's own production, so it lowers the demand for protection. 7/8

Merger control sometimes clear mergers because imports will discipline the merged firm -- but that firm can petition for tariffs to remove that competition. Across jurisdictions, there are mergers that reduce the nr of domestic producers and are followed by tariff petitions. 2/8

Felix Montag