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Market Share Thresholds: On The Conflation Of Empirical Assessments And Legal Policy Judgments

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  • Louis Kaplow

Abstract

In competition law, market power requirements are often articulated in terms of market shares. The use of market share thresholds, however, conflates two distinct questions: First, how much market power exists in a given situation? Second, how much market power should the law require? As a consequence, neither question is answered, or even directly illuminated. Furthermore, because market shares are not themselves measures of market power but instead merely a factor that bears on its magnitude in a given setting, they are inapt answers to both inquiries. Their use involves a category mistake. The identified problems are illustrated by unpacking Learned Hand's famous pronouncement in Alcoa of the market shares required for the offense of monopolization, but the core defects characterize all market share declarations.

Suggested Citation

  • Louis Kaplow, 2011. "Market Share Thresholds: On The Conflation Of Empirical Assessments And Legal Policy Judgments," Journal of Competition Law and Economics, Oxford University Press, vol. 7(2), pages 243-276.
    • Handle: RePEc:oup:jcomle:v:7:y:2011:i:2:p:243-276.
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    File URL: http://hdl.handle.net/10.1093/joclec/nhq031
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    Citations

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    Cited by:

    1. Kaplow, Louis, 2021. "Horizontal merger analysis," International Journal of Industrial Organization, Elsevier, vol. 79(C).
    2. Louis Kaplow, 2011. "Market Definition and the Merger Guidelines," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 39(1), pages 107-125, August.
    3. Bojan Ristić & Dejan Trifunović, 2014. "Horizontal Mergers And Weak And Strong Competition Commissions," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 59(202), pages 69-106, July – Se.
    4. Kaplow, Louis, 2015. "Market definition, market power," International Journal of Industrial Organization, Elsevier, vol. 43(C), pages 148-161.
    5. Xu, Fei & Liu, Qian & Zheng, Xingdong & Cao, Luqi & Yang, Mian, 2022. "Research on the impact of China's high-speed rail opening on enterprise market power: Based on the perspective of market segmentation," Transport Policy, Elsevier, vol. 128(C), pages 121-137.

    More about this item

    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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