MARKET POWER IN COMPETITION FOR THE MARKET

Sangin Park

Journal of Competition Law and Economics, 2009, vol. 5, issue 3, 571-579

Abstract: In the evaluation of abuse of dominance (or Section 2 cases in the United States), the standard method of proving monopoly power is typically faced with difficulties in measuring the competitive price level and the substantiality of market power. These difficulties are more obvious in industries characterized by R&D competition for the market, where drastic innovation, standardization, or bidding for the entire demand is central figure. On the basis of a simple model of R&D competition for the market, this paper provides the competitive price level and the threshold level of substantiality of market power, showing that the absence of barriers to R&D competition ensures no abuse of dominance in these industries.

JEL-codes: K21 L10 L40 (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:oup:jcomle:v:5:y:2009:i:3:p:571-579.

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