The Experts below are selected from a list of 77073 Experts worldwide ranked by ideXlab platform
Justus Haucap - One of the best experts on this subject based on the ideXlab platform.
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Vertical relations, pass-through, and Market Definition: Evidence from grocery retailing
International Journal of Industrial Organization, 2021Co-Authors: Justus Haucap, Ulrich Heimeshoff, Gordon J. Klein, Dennis Rickert, Christian WeyAbstract:Abstract We examine how different pass-through rates from input prices to retail prices and different vertical contracts affect upstream Market Definition. Simple theoretical considerations suggest that vertical restraints induce higher pass-through rates and thus lead to a larger upstream Market Definition when compared to linear wholesale pricing, given that contracts with linear pricing are associated with lower pass-through rates under imperfect competition. Data from grocery retailing is used to quantify the empirical implications of our theoretical assertion. We find that resale price maintenance leads to larger upstream Market Definitions than linear pricing. We therefore advise competition authorities to carefully model vertical Market structures, whenever they expect incomplete pass-through to be important.
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vertical relations pass through and Market Definition evidence from grocery retailing
Social Science Research Network, 2020Co-Authors: Justus Haucap, Ulrich Heimeshoff, Gordon J. Klein, Dennis Rickert, Christian WeyAbstract:We examine how different pass-through rates, from input- to final consumer prices, and different vertical contracts affect upstream Market Definition. Our theory model predicts that, under reasonable conditions, higher pass-through rates lead to Definitions of larger upstream Markets. Data from grocery retailing is used to quantify the empirical implications of our theoretical result. We find that resale price maintenance leads to larger upstream Market Definitions than linear pricing models. The reason is that linear pricing contracts are associated with lower pass-through rates under imperfect competition. We therefore advise competition authorities to carefully model vertical Market structures, whenever they expect incomplete pass-through to be important.
Scott T Thompson - One of the best experts on this subject based on the ideXlab platform.
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Market Definition and Market power in payment card networks
Review of Network Economics, 2006Co-Authors: Erich Emch, Scott T ThompsonAbstract:We discuss competition among payment card networks, and in particular how antitrust practitioners might approach questions of Market Definition and Market power in these Markets. Application of the hypothetical monopolist test to define Markets, and the use of traditional metrics to measure Market power, may be less straightforward for card networks than for many Markets. The "two-sidedness" of the Market does not, however, overturn the basic logic of the hypothetical monopolist test or traditional measurements of Market power. We demonstrate some practical ways to apply these antitrust principles to competition among payment card networks.
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Market Definition and Market power in payment card networks
Research Papers in Economics, 2006Co-Authors: Erich Emch, Scott T ThompsonAbstract:We discuss competition among payment card networks, and in particular how antitrust practitioners might approach questions or Market Definition and Market power in these Markets. Application of the hypothetical monopolist test to define Markets, and the use of traditional metrics to measure Market power, may be less straightforward for card networks than for many Markets. The interrelationships between network pricing to merchants, to bank issuers of payment cards and indirectly, to final consumers, complicates the analysis. The "two-sidedness" of the Market does not, however, overturn the basic logic of the hypothetical monopolist test or traditional measurements of Market power. We demonstrate some practical ways to apply these antitrust principles to competition among payment card networks.
Christian Wey - One of the best experts on this subject based on the ideXlab platform.
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Vertical relations, pass-through, and Market Definition: Evidence from grocery retailing
International Journal of Industrial Organization, 2021Co-Authors: Justus Haucap, Ulrich Heimeshoff, Gordon J. Klein, Dennis Rickert, Christian WeyAbstract:Abstract We examine how different pass-through rates from input prices to retail prices and different vertical contracts affect upstream Market Definition. Simple theoretical considerations suggest that vertical restraints induce higher pass-through rates and thus lead to a larger upstream Market Definition when compared to linear wholesale pricing, given that contracts with linear pricing are associated with lower pass-through rates under imperfect competition. Data from grocery retailing is used to quantify the empirical implications of our theoretical assertion. We find that resale price maintenance leads to larger upstream Market Definitions than linear pricing. We therefore advise competition authorities to carefully model vertical Market structures, whenever they expect incomplete pass-through to be important.
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vertical relations pass through and Market Definition evidence from grocery retailing
Social Science Research Network, 2020Co-Authors: Justus Haucap, Ulrich Heimeshoff, Gordon J. Klein, Dennis Rickert, Christian WeyAbstract:We examine how different pass-through rates, from input- to final consumer prices, and different vertical contracts affect upstream Market Definition. Our theory model predicts that, under reasonable conditions, higher pass-through rates lead to Definitions of larger upstream Markets. Data from grocery retailing is used to quantify the empirical implications of our theoretical result. We find that resale price maintenance leads to larger upstream Market Definitions than linear pricing models. The reason is that linear pricing contracts are associated with lower pass-through rates under imperfect competition. We therefore advise competition authorities to carefully model vertical Market structures, whenever they expect incomplete pass-through to be important.
Erich Emch - One of the best experts on this subject based on the ideXlab platform.
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Market Definition and Market power in payment card networks
Review of Network Economics, 2006Co-Authors: Erich Emch, Scott T ThompsonAbstract:We discuss competition among payment card networks, and in particular how antitrust practitioners might approach questions of Market Definition and Market power in these Markets. Application of the hypothetical monopolist test to define Markets, and the use of traditional metrics to measure Market power, may be less straightforward for card networks than for many Markets. The "two-sidedness" of the Market does not, however, overturn the basic logic of the hypothetical monopolist test or traditional measurements of Market power. We demonstrate some practical ways to apply these antitrust principles to competition among payment card networks.
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Market Definition and Market power in payment card networks
Research Papers in Economics, 2006Co-Authors: Erich Emch, Scott T ThompsonAbstract:We discuss competition among payment card networks, and in particular how antitrust practitioners might approach questions or Market Definition and Market power in these Markets. Application of the hypothetical monopolist test to define Markets, and the use of traditional metrics to measure Market power, may be less straightforward for card networks than for many Markets. The interrelationships between network pricing to merchants, to bank issuers of payment cards and indirectly, to final consumers, complicates the analysis. The "two-sidedness" of the Market does not, however, overturn the basic logic of the hypothetical monopolist test or traditional measurements of Market power. We demonstrate some practical ways to apply these antitrust principles to competition among payment card networks.
Willem H Boshoff - One of the best experts on this subject based on the ideXlab platform.
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Market Definition Using Consumer Characteristics and Cluster Analysis
South African Journal of Economics, 2019Co-Authors: Willem H Boshoff, Rossouw Van JaarsveldAbstract:Competition authorities commence merger investigations with a Definition of the relevant Market, i.e. the collection of products or regions that compete with the firm(s) under investigation. Market Definition relies on evidence of cross‐price elasticity. When the econometric estimation of cross‐price elasticities is not possible, analysts have to rely on qualitative assessment and a set of quantitative tools relying only on a subset of information or less precise quantitative evidence. Under these conditions, a statistical analysis of the similarity of consumer characteristics of different products can offer a useful addition to this toolkit. Cluster analysis can be used to identify meaningful groups of substitutes (and hence Markets) on the basis of homogeneity of products’ consumer characteristics. Cluster analysis is useful not only in drawing Market boundaries, but also in ranking the competitors within the boundaries. In a recent radio merger case in South Africa, competition authorities and counter parties struggled to obtain systematic evidence for Market Definition and ultimately relied on mostly qualitative impressions based on a range of evidence from industry experts and company strategy documents. The substitutes suggested by the cluster analysis matches the closest substitutes suggested by the Competition Tribunal, although the results do not support the Tribunal's list of weaker substitutes.
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Market Definition as a problem of statistical inference
Journal of Competition Law and Economics, 2014Co-Authors: Willem H BoshoffAbstract:Market Definition is conducted under conditions of notable uncertainty, due to conceptual ambiguity and model uncertainty. Statistical decision theory can help to explain and improve the Market Definition decision. Specifically, a Bayesian decision rule can assist analysts in defining Markets by considering (1) the weight of evidence in favor and against substitutability (implying a ranking of substitutes), (2) prior probabilities determined by previous cases and research (setting a benchmark for inclusion in the Market), and (3) error costs of incorrect inclusion or exclusion from the Market. The article studies how employing such a decision rule would have improved the Market Definition exercise in a landmark South African merger case.
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antitrust Market Definition using statistical learning techniques and consumer characteristics
2011Co-Authors: Willem H BoshoffAbstract:Market Definition is the first step in an antitrust case and relies on empirical evidence of substitution patterns. Cross-price elasticity estimates are preferred evidence for studying substitution patterns, due to advances in IO econometric modelling. However, the data and time requirements of these models weigh against their universal adoption for Market Definition purposes. These practical constraints — and the need for a greater variety of evidence — lead practitioners to rely on a larger set of less sophisticated tools for Market Definition. The paper proposes an addition to the existing toolkit, namely an analysis of consumer characteristics for Market Definition purposes. The paper shows how cluster analysis can be used to identify meaningful groups of substitutes on the basis of homogeneity of their consumer profiles. Cluster analysis enforces consistency, while recent bootstrap techniques ensure robust conclusions. To illustrate the tool, the paper relies on data from a recently concluded radio merger in South Africa.
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Advances in price time series tests for antitrust Market Definition
2011Co-Authors: Willem H BoshoffAbstract:Market Definition is an important first step in any competition policy investigation. In competition policy, a Market represents the set of products (product Market) or regions (geographic Market) that constrain the Market power of the firm being investigated. Various quantitative tools have been developed for Market Definition. Econometric tests on price co-movement represent one such set of tools: two regions or products are considered part of the same Market if their prices co-move. However, price co-movement tests, especially the more advanced econometric tests, have been criticized in the competition policy literature. This paper applies a range of tools, including correlation analysis, Granger-causality tests, unit root tests and the recent autoregressive distributed lag (ARDL) bounds test, to data from the 2006-2008 competition investigation into business practices in the South African dairy industry. The paper argues that different price tests ask different questions and that it is not useful to argue, say, that the Market suggested by a more advanced price test differs from the Market suggested by a simple correlation statistic. The paper also responds to the continued practice of criticizing price co-movement for Market Definition on the basis of the poor performance of conventional price tests: many conventional tests have long been shown to suffer from small-sample power and size problems, but critics fail to account for recent improvements in this regard. The paper concludes that while no single price test offers conclusive evidence on the Market, the combination of results offer a rich picture useful for Market Definition purposes.
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Stationarity Tests in Geographic Market Definition: An Application to South African Milk Markets
2007Co-Authors: Willem H BoshoffAbstract:The paper focuses on the delineation of geographic Markets in competition analysis, investigating the use of tests of price co-movement in the Market Definition exercise. To this end, the first part is devoted to a conceptual framework for Market Definition (adopted from Haldrup (2003)). Thereafter, a variety of price tests are explored that can be applied within the quantitative part of the framework. Similar to Forni (2004), the paper emphasizes the use of stationarity tests (that is, tests for the existence of unit roots) – illustrating their application to a recent competition investigation in South Africa.