An economic perspective on the inherent plausibility and frequency of predatory pricing: the case for more aggressive regulation

Ho Fung Griffith Cheng

European Competition Journal, 2020, vol. 16, issue 2-3, 343-367

Abstract: Predatory Pricing has often been said to be rare as a unicorn. Accordingly, the legal thresholds a plaintiff has to surmount in establishing predation is prohibitively high across jurisdictions. This article takes on this assumption from a more nuanced economic perspective, focusing on market imperfections, above-cost pricing and contemporaneous recoupment. The ensuing discussion would indicate that predatory pricing is far more common than judicial assumptions take it to be. This article will then proceed to highlight the merits of a multifactorial assessment in lieu of threshold analyses, highlighting the value of abolishing a recoupment condition and of reintroducing a predatory intent factor in particular.

Date: 2020
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DOI: 10.1080/17441056.2020.1770478

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