Advertisement

Application of Hypothetical Monopoly Test (SSNIP) to the Brazilian Market of Ready-Made Meals and the Role of the Department of Economic Studies

  • Dimas Mateus FazioEmail author
  • Simone Maciel Cuiabano
  • Luiz Alberto Esteves
Chapter
  • 662 Downloads
Part of the International Law and Economics book series (ILEC)

Abstract

This chapter presents empirical evidence resulted from the application of Hypothetical Monopoly Test—SSNIP to the Brazilian market of readymade meals by the Department of Economic Studies of the Brazilian Competition Authority (CADE). The firm-level data was taken, and the SSNIP test was applied to analyze if the relevant market of the merging companies—JBS/Seara and Massa Leve limited to products of the standard category, while products of the main agent of the market—BRF/Sadia—would be in a different niche or category called premium. It was observed that the hypothesis of a separated market for standard and premium readymade meals is practically null. The proposed merger between JBS/Seara and Massa Leve might create a stronger competitor to diminish the dominance of the market by BRF/Sadia. The operation was approved with no restrictions by CADE in 2014 and has marked a period of increased use of new economic methodologies in CADES's decision. This chapter also describes the history of the establishment of a specific Department of Economics in CADE's new structure.

Keywords

Relevant market Monopolist test Competition policy Department of Economic Studies 

JEL

F12 F16 J31 

Notes

Acknowledgment

We would like to thank Paula Bogossian and Talita Miotto for the herculean help on translating this chapter.

References

  1. Werden, G. (1998). Demand elasticities in antitrust analysis. Antitrust Law Journal, 66, 363–414.Google Scholar
  2. Werden, G. (2003). The 1982 Merger guidelines and the ascent of the hypothetical monopolist paradigm. Antitrust Law Review, 71(2003), 253–269.Google Scholar

Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  • Dimas Mateus Fazio
    • 1
    Email author
  • Simone Maciel Cuiabano
    • 2
  • Luiz Alberto Esteves
    • 2
  1. 1.Department of FinanceLondon Business SchoolLondonUK
  2. 2.Department of Economic StudiesCADEBrasiliaBrazil

Personalised recommendations