Unpacking the Economic Toolbox: How to Make Sense of Your Economic Expert’s Analysis

Mon Apr 23 15:51:46 UTC 2018
By Sheng Li, Christine Meyer and Gabriella Monahova

In this article, NERA experts Sheng Li, Christine Meyer and Gabriella Monahova explain four frequently used economic tools and how economists apply them to common antitrust issues. The authors first discuss regression analysis as applied to common antitrust issues. They then explain how critical loss analysis (CLA), the upward pricing pressure (UPP) model, and merger simulation are applied in the review of mergers and acquisitions. For each economic tool, they provide a practical list of the strengths and limitations of these techniques and the key issues that attorneys and economists need to discuss so that they and their clients are fully prepared for how the antitrust agencies or an opposing private litigant might critique the economists’ work. They conclude that while antitrust attorneys and economists often use different terminology, providing the highest level of service to clients requires that attorneys and economists work together to address the same questions about competition in markets.