Sequential Versus Simultaneous Market Delineation: The Relevant Antitrust Market for Salmon

CCP Working Paper No. 05-02

Aarhus University Economics Paper No. 2005-05

23 Pages Posted: 26 Jun 2006  

Niels Haldrup

Aarhus University, School of Economics and Management; CREATES

H. Peter Mollgaard

Copenhagen Business School-Economics

Claus Kastberg Nielsen

Copenhagen Economics

Multiple version iconThere are 2 versions of this paper

Date Written: March 2005

Abstract

Delineation of the relevant market forms a pivotal part of most antitrust cases. The standard approach is sequential. First the product market is delineated, then the geographical market is defined. Demand and supply substitution in both the product dimension and the geographical dimension will normally be stronger than substitution in either dimension. By ignoring this, one might decide first to define products narrowly and then to define the geographical extent narrowly ignoring the possibility of a diagonal substitution. These reflections are important in the empirical delineation of product and geographical markets. Using a unique data set for prices of Norwegian and Scottish salmon, we propose a methodology for simultaneous market delineation and we demonstrate that compared to a sequential approach conclusions will be reversed.

Keywords: Relevant market, econometric delineation, salmon

JEL Classification: C3, K21, L41, Q22

Suggested Citation

Haldrup, Niels and Mollgaard, H. Peter and Nielsen, Claus Kastberg, Sequential Versus Simultaneous Market Delineation: The Relevant Antitrust Market for Salmon (March 2005). CCP Working Paper No. 05-02; Aarhus University Economics Paper No. 2005-05. Available at SSRN: https://ssrn.com/abstract=911541 or http://dx.doi.org/10.2139/ssrn.911541

Niels Haldrup (Contact Author)

Aarhus University, School of Economics and Management ( email )

Universitetsparken
Aarhus, DK 8000 C
Denmark
+45 8942 1133 (Phone)
+45-8613-6334 (Fax)

CREATES ( email )

School of Economics and Management
Aarhus University
Aarhus, DK 8000 C
Denmark
+4589421613 (Phone)

HOME PAGE: http://www.creates.au.dk/en

Hans Peter Mollgaard

Copenhagen Business School-Economics ( email )

Kilevej 14
Frederiksberg C, Select a state DK-2000
Denmark
+45-3815 20202 (Phone)
+4521622015 (Fax)

HOME PAGE: http://www.cbs.dk/staff/petermollgaard/

Claus Kastberg Nielsen

Copenhagen Economics ( email )

Njalsgade 21 G, 6
2300 Copenhagen S
Denmark
+45 70270740 (Phone)
+45 70270741 (Fax)

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