The 2010 Merger Guidelines give greater prominence to the concept of parallel accommodating conduct. Parallel accommodating conduct (PAC) has a long history in oligopoly theory, dating back more than seventy years. It is a type of coordinated conduct that does not require an agreement. Instead,...

This paper explores cooperation incentives in the absence of public reputation information, using an infinite-horizon Prisoners' Dilemma model of sequential relationships. We examine a strategy which we call Quit-for-Tat (QFT). In this model, individuals initially are paired randomly. In the...

The standard Ricardian model of competition has a fixed number of firms, each with limited capacity and differential exogenous costs or qualities. In this paper, we introduce a real entry process by formulating a multistage Ricardian equilibrium model with free entry and stochastic product...

In this short and mainly expository article, we explain the “hypothetical monopolist test” that has become the standard methodology for identifying relevant antitrust markets in merger cases, and discuss two approaches to implementing the test. We then focus on the implementation of the test...

We examine the role of private information on the impact of vertical mergers. A vertical merger can improve the information that is available to an upstream monopolist because, after the merger, the monopolist can observe the cost of its downstream merger partner. In the pre-merger world,...

This article explains the inherent loss of an indirect competitor and reduction in competition when a vertical merger raises input foreclosure concerns. We then calculate a measure of the effective increase in the HHI measure of concentration for the downstream market, and we refer to this...

This comment responds to the request by the Federal Trade Commission and the Department of Justice’s Antitrust Division for public comment on the draft 2020 Vertical Merger Guidelines. In this comment, we show that there is an inherent loss of an indirect competitor and competition when a...

One key concern in vertical merger cases is input foreclosure. Input foreclosure involves raising the costs of competitors in the downstream market, which could in turn increase the sales and profits of the downstream merger partner. In this article, we explain how the upward pricing pressure...