Antitrust Damages in Financial Markets

Journal of Competition Law and Economics, Forthcoming

Posted: 5 Feb 2020

See all articles by John K. Wald

John K. Wald

University of Texas at San Antonio

Date Written: January 11, 2020

Abstract

I briefly review the standard regression methods used to estimate damages in antitrust actions, and I discuss how these would be applied to cases in financial markets. I consider applications to three different financial market cases. The first is the NASDAQ odd-eighths litigation, where existing antitrust methods closely resemble the analyses published in the academic literature on this issue. The second type of case is bond market antitrust litigation, where the expert faces an additional hurdle because they have to estimate bid-ask spreads. The third type of case is related to the LIBOR manipulation scandal. I discuss why existing methods provide a poor fit for the LIBOR damage calculations. Lastly, I discuss IPO issuance fees as an example of price clustering in financial markets which has not let to antitrust litigation.

Keywords: antitrust damages, financial markets, bid-ask spreads, LIBOR

JEL Classification: K21, G14

Suggested Citation

Wald, John K., Antitrust Damages in Financial Markets (January 11, 2020). Journal of Competition Law and Economics, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3518067

John K. Wald (Contact Author)

University of Texas at San Antonio ( email )

1 UTSA Circle
San Antonio, TX 78249
United States
210-458-6324 (Phone)

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