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An Empirical Test of the Free Rider and Market Power Hypotheses: A Comment

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  • Eckard, E Woodrow, Jr

Abstract

Willard F. Mueller and Frederick E. Geithman (1991) test the competing free-rider (efficiency) and market-power explanations of certain vertical restraints once used by the Sealy mattress company and declared illegal after 1980. They estimate that eliminating the restraints increased sales and argue that this supports only the market-power explanation. However, Mueller and Geithman overlook the rise in Sealy's profits that occurred after 1980, a fact which renders their test inconclusive. Copyright 1994 by MIT Press.

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  • Eckard, E Woodrow, Jr, 1994. "An Empirical Test of the Free Rider and Market Power Hypotheses: A Comment," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 586-589, August.
    • Handle: RePEc:tpr:restat:v:76:y:1994:i:3:p:586-89
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    Cited by:

    1. Stephen Martin & John T. Scott, 2017. "GTE Sylvania and Interbrand Competition as the Primary Concern of Antitrust Law," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 51(2), pages 217-233, September.

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