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Full-Text Articles in Law
Antitrust And Information Technologies, Herbert Hovenkamp
Antitrust And Information Technologies, Herbert Hovenkamp
Herbert Hovenkamp
Technological change strongly affects the use of information to facilitate anticompetitive practices. The effects result mainly from digitization and the many products and processes that it enables. These technologies also account for a significant portion of the difficulties that antitrust law encounters when its addresses intellectual property rights. Changes in the technologies of information also affect the structures of certain products, in the process either increasing or decreasing the potential for competitive harm. For example, digital technology affects the way firms exercise market power, but it also imposes serious measurement difficulties. In purely digital markets intellectual property rights are crucial …
Market Power In Antitrust, George A. Hay
Market Power In Antitrust, George A. Hay
George A. Hay
The concept of market power is at the core of antitrust. Philosophically, antitrust policy is aimed primarily at preventing firms from achieving, retaining, or abusing market power. Operationally, assessing whether a firm or firms have market power or any reasonable prospect for achieving it is often the first (and sometimes, the only) step in performing an antitrust analysis. Few would dispute that market power should play a prominent role in antitrust analysis. Nevertheless, important questions remain. Some of these questions quite naturally focus on the precise degree of importance given to market power. Is it an essential ingredient in antitrust …
An Instrumental Theory Of Market Power And Antitrust Policy, Jeffrey L. Harrison
An Instrumental Theory Of Market Power And Antitrust Policy, Jeffrey L. Harrison
Jeffrey L Harrison
Since Judge Hand's pivotal opinion in United States v. Aluminum Company of America (Alcoa), the possession of monopoly power has been treated as presumptively legal. The focus of the antitrust laws since then has been on defining when that power is abused. This approach to market power cannot be squared with the prevailing view that antitrust law is grounded in economic theory. To understand why, one must see market power for what it is: the ability of a firm to raise prices above competitive levels and to profitably keep them there. Seen in this light, market power is indistinguishable from …
Firm-Specific Cost Savings And Market Power, Bart Wilson, Douglas Davis
Firm-Specific Cost Savings And Market Power, Bart Wilson, Douglas Davis
Bart J Wilson
We report a policy experiment that illustrates a potential problem of using historical pass-through rates as a means of predicting the competitive consequences of projected firm-specific cost savings in antitrust contexts, particularly in merger analysis. The effects of cost savings on welfare can vary vastly, depending on how the savings affect the industry supply schedule. In a capacity-constrained price-setting oligopoly, we observe that cost savings can overwhelm behaviorally salient market power incentives when the savings affect marginal (high cost) units. However, cost savings of the same magnitude on an infra-marginal unit leave market power unchanged.
Controlling Market Power And Price Spikes In Electricity Networks: Demand-Side Bidding, Vernon Smith, Stephen Rassenti, Bart Wilson
Controlling Market Power And Price Spikes In Electricity Networks: Demand-Side Bidding, Vernon Smith, Stephen Rassenti, Bart Wilson
Bart J Wilson
No abstract provided.
Is Market Monitoring A Substitute For Regulation In Restructured Wholesale Electricity Markets?, Lon L. Peters
Is Market Monitoring A Substitute For Regulation In Restructured Wholesale Electricity Markets?, Lon L. Peters
Lon L Peters
Over ten years ago, wholesale electricity markets in many parts of the U.S. were fundamentally restructured. Vertically integrated electric utilities were replaced by centrally designed and administered auctions repeated on a regular basis. Federal oversight was relaxed, as the Federal Energy Regulatory Commission relied (and continues to rely) largely on reports by “market monitors” regarding the competitive conditions in these new markets. A review of the monitors’ reports during the first few years of this new approach reveals that fundamental concepts of economic theory, especially regarding the structure, conduct, and performance of markets, were either ignored or misapplied. As a …
Technological Convergence And Competition On The Edge - „Emerging Markets“ And Their Regulation, Andrea Stazi
Technological Convergence And Competition On The Edge - „Emerging Markets“ And Their Regulation, Andrea Stazi
Andrea Stazi
Technological convergence, on the one hand, tends to point out new roles - and sometimes also markets - for the players in the communications industry, producing the segmentation of different functions and phases in the value chain. On the other hand, technological convergence could bring forth numerous specific antitrust issues, such as an increase in the market power of the suppliers of more appealing services or contents, or a premature foreclosure of the new market due to leveraging of the power maintained by a company in another market. A topic of particular interest, till now quite neglected by legal doctrine, …
Firm-Specific Cost Savings And Market Power, Bart Wilson, Douglas Davis
Firm-Specific Cost Savings And Market Power, Bart Wilson, Douglas Davis
Bart J. Wilson
We report a policy experiment that illustrates a potential problem of using historical pass-through rates as a means of predicting the competitive consequences of projected firm-specific cost savings in antitrust contexts, particularly in merger analysis. The effects of cost savings on welfare can vary vastly, depending on how the savings affect the industry supply schedule. In a capacity-constrained price-setting oligopoly, we observe that cost savings can overwhelm behaviorally salient market power incentives when the savings affect marginal (high cost) units. However, cost savings of the same magnitude on an infra-marginal unit leave market power unchanged.