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- Publisher
- Oxford University Press
- Copyright
- Published by Oxford University Press 2014. This work is written by US Government employees and is in the public domain in the US.
- ISSN
- 2050-0688
- eISSN
- 2050-0696
- DOI
- 10.1093/jaenfo/jnu003
- Publisher site
- See Article on Publisher Site
Abstract
The 2010 Merger Guidelines advance the idea of direct estimation of competitive effects as an alternative approach to the standard two-stage market definition, economic analysis approach to merger policy. Thus, merger analysts must choose between the two techniques. For both institutional and empirical reasons, we suggest that the standard market definition methodology is likely to remain the dominant approach to merger review. Our overview of three modelling structures, along with three empirical methodologies used to define markets, highlights the scenarios in which market definition remains the best choice for the merger analyst. Empirical data from Federal Trade Commission merger investigations confirms this insight with the three modelling structures (homogeneous product, static differentiation, and dynamic differentiation) all applied to evaluate competition. Choice among these modelling structures requires case-by-case analysis, with opportunities for direct analysis of anticompetitive effects limited to a sub-sample of the static differentiation cases.
Journal
Journal of Antitrust Enforcement – Oxford University Press
Published: Oct 28, 2014