Market Power: How Does it Arise? How is it Measured?

50 Pages Posted: 12 May 2012

See all articles by Lawrence J. White

Lawrence J. White

New York University (NYU) - Leonard N. Stern School of Business, Department of Economics

Date Written: May 2012

Abstract

Market power – how it arises, and how it is measured – is an important topic for the economics field of “industrial organization” (IO). It is also an important topic for managers and for managerial economics, since it can be related to sustainable advantage for a company and it is usually at the center of antitrust cases in which a company may be involved. This chapter defines market power, discusses how it arises, and describes the various methods that have been used for empirically detecting and measuring it. Attention is also given to the role and measurement of market power in important antitrust contexts.

Keywords: market power, monopoly, oligopoly, competition, Lerner index, S-C-P paradigm, antitrust, merger guidelines

Suggested Citation

White, Lawrence J., Market Power: How Does it Arise? How is it Measured? (May 2012). NYU Working Paper No. 2451/31547. Available at SSRN: https://ssrn.com/abstract=2056708

Lawrence J. White (Contact Author)

New York University (NYU) - Leonard N. Stern School of Business, Department of Economics ( email )

44 West 4th Street
Suite 9-160
New York, NY NY 10012
United States

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