Merger simulation in an administrative context

Antitrust Law Journal

Volumn 77, Issue 2, 2011, Pages 451-472

  Baker, Jonathan B ^a  

^a AMERICAN UNIVERSITY   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 80052989111     PISSN: 00036056     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (46)

1. see Gregory J. Werden & Luke M. Froeb, Unilateral Competitive Effects of Horizontal Mergers, in HANDBOOK OF ANTITRUST ECONOMICS 43 (Paolo Buccirossi ed., 2008)
2. Oliver Budzinski & Isabel Ruhmer, Merger Simulation in Competition Policy: A Survey, 6 J. COMPETITION L. & ECON. 277 (2010).
3. PETER DAVIS & ELIANA GARCES, QUANTITATIVE TECHNIQUES FOR COMPETITION AND ANTITRUST ANALYSIS 382-435 (2010)
4. Jonathan B. Baker & David Reitman, Research Topics in Unilateral Effects Analysis, in RESEARCH HANDBOOK ON THE ECONOMICS OF ANTITRUST LAW (Einer Elhauge ed., forthcoming 2011) (working paper version available at http://ssrn.com/abstractsl504863).
5. Herbert Hovenkamp, Derek Bok and the Merger of Law and Economics, 21 U. MICH. J.L. REFORM 515 (1988).
6. See U.S. Dep't of Justice & Fed. Trade Comm'n, Horizontal Merger Guidelines §§6.2-6.3 (2010) [hereinafter Guidelines], available at http://ftc.gov/os/2010/08/100819hmg. pdf.
7. see Jonathan B. Baker, Why Did the Antitrust Agencies Embrace Unilateral Effects? 12 GEO. MASON L. REV. 31 (2003). The discussion of unilateral effects in this article emphasizes the most common setting, of mergers between sellers of differentiated products.
8. Jonathan B. Baker & Robert Pitofsky, A Turning Point in Merger Enforcement: Federal Trade Commission v. Staples, in ANTITRUST STORIES 311 (Eleanor M. Fox & Daniel A. Crane eds., 2007) (legal discussion of the case).
9. Cf. Jonathan B. Baker, Stepping Out in an Old Brown Shoe: In Qualified Praise of Submarkets, 68 ANTITRUST L.J. 203, n.30 (2000) [hereinafter Baker, Stepping Out].
10. See generally Jonathan B. Baker & Carl Shapiro, Reinvigorating Horizontal Merger Enforcement 235, 241-44, in How THE CHICAGO SCHOOL OVERSHOT THE MARK: THE EFFECT OF CONSERVATIVE ECONOMIC ANALYSIS ON U.S. ANTITRUST (Robert Pitofsky ed., 2008)
11. Jonathan B. Baker & Timothy F. Bresnahan, Estimating the Residual Demand Curve Facing a Single Firm 6 INT'L J. INDUS. ORG. 283 (1988)
12. Jonathan B. Baker & Timothy F. Bresnahan, The Gains from Merger or Collusion in Product- Differentiated Industries, 33 J. INDUS. ECON. 427 (1985) [hereinafter Gains from Merger].
13. See generally JOHN SUTTON, SUNK COSTS AND MARKET STRUCTURE (1991). Multistate regions were likely geographic markets for U.S. brewing during the late 1970s.
14. See Christian Schmidt Brewing Co. v. G. Heileman Brewing Co., 753 F.2d 1354 (6th Cir. 1985) (upholding challenge to brewing industry merger within a twelve-state upper Midwest geographic market).
15. See , e.g., Daniel M. Wall, FTC Unilateral Effects Analysis and Litigation Workshop: Panel on the Role of Market Definition 97, 100-01 (Feb. 12, 2008) (transcript), available at http:// www.ftc.gov/bc/unilateral/transcript. pdf.
16. See Jonathan B. Baker, FTC Unilateral Effects Analysis and Litigation Workshop: Panel on the Role of Market Definition 97, 108-09 (Feb. 12, 2008) (transcript), available at http://www. ftc.gov/bc/unilateral/transcript.pdf.
17. see Jonathan B. Baker, Market Concentration in the Antitrust Analysis of Horizontal Mergers, in ANTITRUST LAW AND ECONOMICS 234 (Keith N. Hylton ed., 2d ed. 2010) [Market Concentration] (corrected in a working paper available at http://ssrn.com/abstract= 1092248).
18. See generally ANDREW I. GAVIL, WILLIAM E. KOVACIC & JONATHAN B. BAKER, ANTITRUST LAW IN PERSPECTIVE: CASES, CONCEPTS AND PROBLEMS IN COMPETITION POLICY 505-06 (2d ed. 2008) (Sidebar 5-6).
19. Jonathan B. Baker, Mavericks, Mergers, and Exclusion: Proving Coordinated Competitive Effects Under the Antitrust Laws, 77 N.Y.U. L. REV. 135, 139 (2002) [hereinafter Mavericks}.
20. United States v. Baker Hughes Inc., the D.C. Circuit described market concentration as simply "a convenient starting point" for a "totality-of the-circumstances" analysis.
21. United States v. Baker Hughes Inc., 908 F.2d 981, 984 (D.C. Cir. 1990).
22. But cf. FTC v. H.J. Heinz Co., 246 F.3d 708 (D.C. Cir. 2001)
23. Joseph Farrell & Carl Shapiro, Recapture, Pass-Through, and Market Definition, 76 ANTITRUST L.J. 585 (2010).
24. See also E. Glen Weyl & Michal Fabinger, Pass-Through as an Economic Tool 30-34 (Oct. 29, 2009), available at http://ssrn.com/ abstract= 1324426.
25. See , e.g., Craig Peters, Evaluating the Performance of Merger Simulation: Evidence from the U.S. Airline Industry, 49 J.L. & ECON. 627 (2006)
26. see generally Michael Doane, Luke Froeb & Steven Tschantz, WARNING: Improper Use of the New Horizontal Merger Guidelines Can Result in Overly Narrow Markets, Mistaken Inferences of Market Power, and Wrong- Headed Analyses, CPI ANTITRUST CHRON., Autumn 2010, Vol. 10, No. 2, at 1, 4
27. Carl Shapiro, Unilateral Effects Calculations 8 (Oct. 2010), available at http://faculty.haas. berkeley.edu/shapiro/unilateral.pdf
28. see also Carl Shapiro, Mergers with Differentiated Products, ANTITRUST, Spring 1996, at 23.
29. Joseph Farrell & Carl Shapiro Antitrust Evaluation of Horizontal Mergers: An Economic Alternative to Market Definition, B.E. J. THEORETICAL ECON.: POLICIES & PERSPECTIVES, vol. 10, issue 1, art. 9 (2010), http://www.bepress.com/bejte/vol10/issl/art9.
30. see Carl Shapiro, The 2010 Horizontal Merger Guidelines: From Hedgehog to Fox in Forty Years, 77 ANTITRUST L.J. 701 (2010)
31. Steven C. Salop, Serge X. Moresi & John R. Woodbury, Scoring Unilateral Effects with the GUPPI: The Approach of the New Horizontal Merger Guidelines, CRA COMPETITION MEMO (Aug. 31, 2010), available at http://www.crai.com/uploadedFiles/Publications/Commentary-on-the-GUPPI.pdf.
32. See also Serge Moresi, The Use of Upward Price Pressure Indices in Merger Analysis, ANTITRUST SOURCE, Feb. 2010, http://www.americanbar.org/content/dam/ aba/publishing/antitrust-source/FeblO-Moresi2-25f.authcheckdam.pdf.
33. See Jerry Hausman, Serge Moresi & Mark Rainey, Unilateral Effects of Mergers with General Linear Demand, 111 ECON. LETTERS 119 (2011).
34. see Dennis W. Carlton, Use and Misuse of Empirical Methods in the Economics of Antitrust, CPI ANTITRUST CHRON., Spring 2011, Vol. 3, No. 1, at 1, 10.
35. MICHAEL D. WHINSTON, LECTURES ON ANTITRUST ECONOMICS 105-10 (2006).
36. Gregory J. Werden, A Robust Test for Consumer Welfare Enhancing Mergers Among Sellers of Differentiated Products, J. INDUS. ECON. 409 (1996)
37. Gregory J. Werden & Luke Froeb, Choosing Among Tools forAssessing Unilateral Merger Effects (Mar. 1, 2011), available at http://ssrn.com/abstract= 180424.
38. Kai-Uwe Kiihn, The Coordinated Effects of Mergers, in HANDBOOK OF ANTITRUST ECONOMICS
39. Pierluigi Sabbatini, How to Simulate the Coordinated Effects of a Merger, 12 Autorita Garante della Concorrenza e del Mercato, Temi e Problemi (June 2006), available at www.agcm. it/trasp-statistiche/doc-download/2659-tp012.html.
40. Focal rules are discussed in Jonathan B. Baker, Two Sherman Act Section I Dilemmas: Parallel Pricing, the Oligopoly Problem, and Contemporary Economic Theory, 38 ANTITRUST BULL. 143, 162-69 (1993).
41. William E. Kovacic, Robert C. Marshall, Leslie M. Marx & Steven P. Schulenberg, Coordinated Effects in Merger Review: Quantifying the Payoffs from Collusion, in 2006 FORDHAM COMPETITION L. INST. 271 (Barry E. Hawk ed., 2007), available at http://faculty.fuqua.duke.edu/ ~marx/bio/papers/ FordhamChapter%2013.pdf.
42. Peter Davis & Cristian Huse, Estimating the "Coordinated Effect" of Mergers (Jan. 2010), available at http://www.competition- commission.org.uk/our-role/anaIysis/Peter%20Davis-Cristian%20Huse-2010.pdf
43. Edward J. Green & Robert H. Porter, Noncooperative Collusion Under Imperfect Price Information, 52 ECONOMETRICA 87 (1984).
44. Cf. Andrew R. Dick, Coordinated Interaction: Pre-Merger Constraints and Post-Merger Effects, 12 GEO. MASON. L. REV. 65, 72-80 (2003).
45. Olivier Compte, Fre'de'ric Jenny & Patrick Rey, Capacity Constraints, Mergers and Collusion, 46 EUR. ECON. REV. 1 (2002) (same).
46. Cf. Oliver Budzinski, An Institutional Analysis of the Enforcement Problems in Merger Control 19-22 (May 2010) (recommending the use of economically based rebuttable presumptions), available at http://ssrn.com/ abstract=1615486.