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On the Effectiveness of Anit-Predation Rules


  • Rainer Nitsche


Current anti-predation rules are designed to detect and prevent actions that are only taken to drive out a rival. We evaluate the performance of these rules in a simple entry game. We find that the rules used by competition authorities fail to encourage sustained competition in the market. Moreover, despite the rules an inefficient incumbent cannot be replaced by a more efficient entrant unless the difference in efficiency is extreme. One reason for these failures is that incumbents choose a strategic response to the legal environment. Large incumbents, for instance, crowd the product space. This is detrimental to welfare and consumer surplus. ZUSAMMENFASSUNG - (Die Effektivität von Wettbewerbsregeln gegen Verdrängungspreisverhalten) Wettbewerbsbehörden stützen sich auf Wettbewerbsregeln, um Unternehmen an Handlungen zu hindern, die nur dann profitabel sind, wenn sie zum Marktaustritt des Rivalen führen. Der Autor analysiert die Effektivität dieser Regeln in einem einfachen Markteintrittsspiel und zeigt, daß die Regeln keinen dauerhaften Wettbewerb im Markt erzeugen. Darüber hinaus verfehlen die Regeln ein weiteres Ziel: auch bei perfekter Durchsetzung der Regeln kann ein effizienterer Marktneuling in einem Verdrängungskampf nicht gegen das alteingesessene Unternehmen gewinnen, es sei denn, die Effizienzunterschiede sind extrem. Ein Grund für dieses Scheitern ist, dass sich die alteingesessenen Unternehmen strategisch an die rechtlichen Rahmenbedingungen anpassen. Wenn ein Markteintritt von effizienteren Unternehmen droht, so entscheiden sie sich eher für eine Angebotserhöhung als den Markteintritt zu gestatten. In dem untersuchten Spiel mindert dies Wohlfahrt und Konsumtenrente.

Suggested Citation

  • Rainer Nitsche, 2002. "On the Effectiveness of Anit-Predation Rules," CIG Working Papers FS IV 02-12, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
  • Handle: RePEc:wzb:wzebiv:fsiv02-12

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    References listed on IDEAS

    1. Kenneth L. Judd, 1985. "Credible Spatial Preemption," RAND Journal of Economics, The RAND Corporation, vol. 16(2), pages 153-166, Summer.
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    More about this item


    competition policy; entry;

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices


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