Burdens and Balancing in Multisided Markets: The First Principles Approach of Ohio v. American Express
Forthcoming in the Review of Industrial Organization (2019)
47 Pages Posted: 8 Jan 2019 Last revised: 9 Jan 2019
Date Written: December 31, 2018
Multisided platforms have distinct and critical features that set them apart from single-sided markets. This realization has led to a split among courts, antitrust practitioners, and economists as to the best method to assess whether mergers or conduct that involve platforms result in the creation or maintenance of monopoly power and violate the antitrust laws. Some argue that each side of a platform constitutes a separate relevant product market. Others argue for a single, integrated market that incorporates all sides. We argue that any prima facie antitrust assessment of competitive harm must incorporate the impact to consumers on all sides regardless of market definition. We also explain why output effects should be the primary emphasis of competitive effects analyses. The Supreme Court recently and correctly adopted this approach in Ohio v. American Express.
Keywords: platforms, multi-sided markets, two-sided markets, antitrust, credit cards, payment cards, rule of reason, Supreme Court, burden shifting
JEL Classification: K21, K41, L40
Suggested Citation: Suggested Citation