Assessing the Anticompetitive Effects of Multiproduct Pricing

Dennis Carlton, Patrick Greenlee and Michael Waldman

No 14199, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In response to the "standardless" approach used in LePage's v. 3M, the Antitrust Modernization Commission (AMC) and others advocate using a discount allocation approach to assess whether bundled loyalty discounts violate Section 2 of the Sherman Act. This approach treats loyalty discounts like predatory pricing. The analogy to predatory pricing is flawed. We propose an alternative approach that focuses on the presence of significant scale economies. We use our approach to analyze LePage's, as well as the recent PeaceHealth decision.

JEL-codes: L4 (search for similar items in EconPapers)
Date: 2008-07
New Economics Papers: this item is included in nep-com and nep-mkt
Note: IO
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Citations: View citations in EconPapers (8)

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