Three Economist’s Tools for Antitrust Analysis: A Non-technical Introduction

Russell Pittman

A chapter in Competition Authorities in South Eastern Europe, 2018, pp 155-172 from Springer

Abstract: Abstract The importance of economics to the analysis and enforcement of competition policy and law has increased tremendously in the developed market economies in the past 40 years. In younger and developing market economies, competition law itself has a history of 20–25 years at most—sometimes much less—and economic tools that have proven useful to competition law enforcement in developed market economies in focusing investigations and in assisting decision makers in distinguishing central from secondary issues are inevitably less well understood. This paper presents a non-technical introduction to three economic tools that have become widespread in competition law enforcement in general and in the analysis of proposed mergers in particular: critical loss analysis, upward pricing pressure, and the vertical arithmetic. The first is used primarily in the context of horizontal mergers for both market definition and the analysis of potential competitive effects from the merger, while the second and third are used primarily in the analysis of potential competitive effects, the second in horizontal mergers and the third in vertical mergers.

Keywords: Merger enforcement; Critical loss analysis; Upward pricing pressure; Vertical arithmetic; Horizontal mergers; Vertical mergers; Antitrust economics (search for similar items in EconPapers)
Date: 2018
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Working Paper: Three Economist’s Tools for Antitrust Analysis: A Non-Technical Introduction (2017)
Working Paper: Three Economist’s Tools for Antitrust Analysis: A Non-Technical Introduction (2017)
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DOI: 10.1007/978-3-319-76644-7_9

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