Abstract
This article describes some of the work of Antitrust Division economists over the past year, with a focus on modeling. It begins by illustrating the mapping from evidence to prediction using tools for assessing the effects of mergers using Bertrand, Cournot, and auction models. It then turns to two hot topics in competition policy: the implications of claims of increasing margins for merger enforcement and the validity of claims of increasing concentration. Finally, it considers how mergers affect prices in bargaining models.
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Notes
The Antitrust R Package includes functionality that is not currently accessible through the web interface. For instance, the web interface does not allow users to analyze partial ownership changes, the Bertrand model with linear or log-linear demand, or a second-price procurement auction model under different distributional assumptions for costs—all of which are capabilities of the Antitrust R Package.
R as well as the following R packages must be installed along with all of their dependent packages: antitrust, rhandsontable, and shiny R. Once these packages are installed, the R command line to run the web interface is: antitrust::antitrust_shiny().
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The views expressed herein are not purported to reflect those of the U.S. Department of Justice.
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Froeb, L.M., Pittman, R.W., Taragin, C.S. et al. Economics at the Antitrust Division: 2017–2018. Rev Ind Organ 53, 637–651 (2018). https://doi.org/10.1007/s11151-018-9663-7
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DOI: https://doi.org/10.1007/s11151-018-9663-7