Sequential versus simultaneous market delineation: The relevant antitrust market for salmon

Niels Haldrup, Peter Møllgaard, Claus Kastberg Nielsen

Research output: Working paper › Research

Abstract

Delineation of the relevant market forms a pivotal part of most antitrustcases. The standard approach is sequential. First the product marketis delineated, then the geographical market is defined. Demand andsupply substitution in both the product dimension and the geographicaldimension will normally be stronger than substitution in either dimension.By ignoring this one might decide first to define products narrowly andthen to define the geographical extent narrowly ignoring the possibility ofa diagonal substitution. These reflections are important in the empiricaldelineation of product and geographical markets. Using a unique data setfor prices of Norwegian and Scottish salmon, we propose a methodologyfor simultaneous market delineation and we demonstrate that comparedto a sequential approach conclusions will be reversed.JEL: C3, K21, L41, Q22Keywords: Relevant market, econometric delineation, salmon.
Delineation of the relevant market forms a pivotal part of most antitrustcases. The standard approach is sequential. First the product marketis delineated, then the geographical market is defined. Demand andsupply substitution in both the product dimension and the geographicaldimension will normally be stronger than substitution in either dimension.By ignoring this one might decide first to define products narrowly andthen to define the geographical extent narrowly ignoring the possibility ofa diagonal substitution. These reflections are important in the empiricaldelineation of product and geographical markets. Using a unique data setfor prices of Norwegian and Scottish salmon, we propose a methodologyfor simultaneous market delineation and we demonstrate that comparedto a sequential approach conclusions will be reversed.JEL: C3, K21, L41, Q22Keywords: Relevant market, econometric delineation, salmon.
LanguageEnglish
Place of PublicationFrederiksberg
PublisherCopenhagen Business School, CBS
Number of pages24
StatePublished - 2005
SeriesWorking Paper / Department of Economics. Copenhagen Business School
Number2-2005

Keywords

  • Relevant market
  • Econometric delineation
  • Salmon

Cite this

Haldrup, N., Møllgaard, P., & Kastberg Nielsen, C. (2005). Sequential versus simultaneous market delineation: The relevant antitrust market for salmon. Frederiksberg: Copenhagen Business School, CBS. Working Paper / Department of Economics. Copenhagen Business School, No. 2-2005
Haldrup, Niels ; Møllgaard, Peter ; Kastberg Nielsen, Claus. / Sequential versus simultaneous market delineation : The relevant antitrust market for salmon. Frederiksberg : Copenhagen Business School, CBS, 2005. (Working Paper / Department of Economics. Copenhagen Business School; No. 2-2005).
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Haldrup, N, Møllgaard, P & Kastberg Nielsen, C 2005 'Sequential versus simultaneous market delineation: The relevant antitrust market for salmon' Copenhagen Business School, CBS, Frederiksberg.

Sequential versus simultaneous market delineation : The relevant antitrust market for salmon. / Haldrup, Niels; Møllgaard, Peter; Kastberg Nielsen, Claus.

Frederiksberg : Copenhagen Business School, CBS, 2005.

Research output: Working paper › Research

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N2 - Delineation of the relevant market forms a pivotal part of most antitrustcases. The standard approach is sequential. First the product marketis delineated, then the geographical market is defined. Demand andsupply substitution in both the product dimension and the geographicaldimension will normally be stronger than substitution in either dimension.By ignoring this one might decide first to define products narrowly andthen to define the geographical extent narrowly ignoring the possibility ofa diagonal substitution. These reflections are important in the empiricaldelineation of product and geographical markets. Using a unique data setfor prices of Norwegian and Scottish salmon, we propose a methodologyfor simultaneous market delineation and we demonstrate that comparedto a sequential approach conclusions will be reversed.JEL: C3, K21, L41, Q22Keywords: Relevant market, econometric delineation, salmon.

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Haldrup N, Møllgaard P, Kastberg Nielsen C. Sequential versus simultaneous market delineation: The relevant antitrust market for salmon. Frederiksberg: Copenhagen Business School, CBS. 2005.

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