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Antitrust Law Enforcement in Aftermarkets:for Product Boundaries Estimates to Competition Advocacy

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  • Shastitko, A.

Abstract

This article brings out and summarizes approaches to definition of market product boundaries for the purpose of antitrust law enforcement in accordance with the relationship between the main and derivative products. Following factors are discussed: price of the derivate product in absolute terms and in comparison with the main product price; probability of the derivative product sale to consumer under period of the main product use; the main product buyers structure; information on durables post-sale service conditions availability. It is shown applicability of transaction cost economics approach to discuss issues relating antitrust and contracting using such transaction features as bounded rationality, opportunistic behavior and assets specificity. The reasons to mitigate the mode of antitrust enforcement in aftermarkets are exposed: research and development expenditures, reputation effects for the main product producer who controls aftermarket, increasing return to scale in aftermarket. The article provides the assessment of the results of Russian antimonopoly policy and competition advocacy in related markets characterized by «main producterivative product» relationship. Special attention is devoted to compliance practices of manufacturers and dealers in auto industry from the perspective of competition support in aftermarkets. The article offers policy implications for the antitrust law enforcement in aftermarkets in Russia.

Suggested Citation

  • Shastitko, A., 2015. "Antitrust Law Enforcement in Aftermarkets:for Product Boundaries Estimates to Competition Advocacy," Journal of Modern Competition, Synergy University, vol. 9(4), pages 5-29.
    • Handle: RePEc:snr:mdrcmp:v:9:y:2015:i:4:p:5-29
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