Reduced-Form Versus Structural Econometric Methods in Market Definition: Lessons from Aetna-Humana

05 July 2017
Dr. Subbu Ramanarayanan and Dr. Paul Wong

NERA Associate Director Dr. Subbu Ramanarayanan and Senior Consultant Dr. Paul Wong use the setting of the Aetna-Humana merger litigation to examine the issues surrounding the use of structural versus reduced form econometric methods, particularly when it comes to informing relevant market definition. In the article published in the June 2017 issue of Antitrust Health Care Chronicle, the authors explore the merits and flaws of the approaches and offer thoughts on how to use these methods to construct compelling evidence supporting relevant market definition.