Estimating Overcharges in Antitrust Cases Using a Reduced-Form Approach: Methods and Issues
James F. Nieberding
North Coast Economics, LLC
Journal of Applied Economics, Vol. 9, No. 2, pp. 361-380, November 2006
This paper presents several methods and discusses salient issues pertaining to the use of reduced-form models to estimate overcharges in antitrust matters (e.g., price-fixing) where but-for prices may be less than actual prices during the anticompetitive period. In particular, two common types of reduced-form estimations are discussed: the dummy variable approach and the forecasting approach. Under either methodology, an error correction model is then specified as one way to address technical problems often found in applied time-series analysis - nonstationary data and the existence of short-term and longterm dynamics.
Number of Pages in PDF File: 20
Keywords: antitrust, price fixing, estimated overcharges, econometrics
JEL Classification: C22, K21, L4Accepted Paper Series
Date posted: December 7, 2006
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