Economics of Antitrust: New Issues, Questions, and Insights
30 September 2004
Book Review
By William H. Page, Marshall M. Criser Eminent Scholar and Associate Dean for Faculty Development, University of Florida, Levin College of Law
This book is an all-NERA effort: fourteen articles written by NERA economists, edited by one of those economists, and published by NERA itself. The articles initially appeared in the NERA newsletter, Antitrust Insights. All of the articles are short (about ten pages each, with a few endnotes) and discuss specific economic and statistical issues that arise in antitrust litigation or regulation. Half of the articles deal with issues in merger cases, and half deal with issues involving other practices, including predatory pricing, price discrimination, tying, and exclusionary contracts. The editor provides a preface, index, and useful abstracts for each of the articles.
The discussions are all in readable prose, and include no equations or diagrams, other than a few tables. Yet I would not call them strictly nontechnical, because they do deal with some advanced and topical issues. For example, Sumanth Addanki distinguishes the "residual" elasticity of demand implicit in the Lerner Index of monopoly power, and "Marshallian" elasticity of demand. The former measure takes account of anticipated price responses of other firms; the latter assumes that prices of other products are held constant. When an econometric study estimates the Marshallian demand elasticity, which is appropriate for measuring substitution between products in market definition, it is likely to differ from the residual elasticity figure. If the study is used in litigation, this disparity will probably provoke questions for an expert on cross examination.
Most of the other essays likewise focus on the interaction of economic analyses with legal or regulatory requirements. Because many of the essays grow out of practical applications of economic theory and statistical methods in actual studies used in litigation, they will be interesting to economists who study antitrust issues. And, because of their topicality and accessibility, they will also be useful to economically informed antitrust practitioners and students.
To order a copy of this book, please visit www.economicsofantitrust.com.
This review represents the views of the author and not necessarily those of the American Bar Association or its Section of Antitrust Law. From The Antitrust Source, September 2004. Copyright 2004 American Bar Association. Reproduced by permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
