Predation Analysis and the FTC's Case Against Intel
Daniel A. Crane
University of Michigan Law School
May 25, 2010
University of Michigan Law & Economics Empirical Legal Studies Center Paper No. 10-014
University of Michigan Public Law Working Paper No. 202
The Federal Trade Commission's pending antitrust case against Intel challenges a number of Intel's discounting and rebating practices. The Commission appears poised to apply a cost-price test to the challenged practices, but proposes to include "fixed sunk costs" in the appropriate measure of cost. This paper explains the importance of using cost-price screens to assess unilaterally imposed prices and analyzes the futility of including sunk costs in the relevant cost measure.
Number of Pages in PDF File: 21
Keywords: Federal Trade Commission, Intel, Cost-Price Screens, Fixed Sunk Costs
JEL Classification: K21, K22
Date posted: May 29, 2010
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