Operationalizing the Hypothetical Monopolist Test

By Harkrider, John D.

Book Id: WPLBN0000151209
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Title:	Operationalizing the Hypothetical Monopolist Test
Author:	Harkrider, John D.
Volume:
Language:	English
Subject:	Trade, Import and export controls, Federal Trade Commission (U.S.)
Collections:	Economics Publications Collection, Federal Trade Commission
Historic Publication Date:
Publisher:	Government Printing Office


Citation APA MLA Chicago D. Harkride, B. J. (n.d.). Operationalizing the Hypothetical Monopolist Test. Retrieved from https://www.gutenberg.us/

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Government Reference Publication

Excerpt
The hypothetical monopolist test is one of the organizing principles of the Horizontal Merger Guidelines, and it is a test increasingly applied to define markets, not just in merger cases, but throughout antitrust, and not just in the U.S., but throughout the world. While it is certainly true that the hypothetical monopolist test ?advanced a new approach to market definition? whose ?importance and brilliancecannot be overstated,?1 it is equally true that the hypothetical monopolist test is ?not flawless.?2 Indeed, three years after the 1982 Guidelines were published George Stigler commented that, ?(the Guidelines? market definition test) has one, wholly decisive defect: it is completely nonoperational. No method of investigation of data is presented, and no dataare specified that will allow the market to be determined empirically.?3 History has proven that Stigler?s concern was overstated, as there clearly is data that will operationalize the hypothetical monopolist test. Using reliable data is critically important because without such data, courts frequently resort to the Brown Shoe factors4 such as...