Encyclopedia of Law and Economics

Living Edition
| Editors: Alain Marciano, Giovanni Battista Ramello

Static Market Power

Living reference work entry
DOI: https://doi.org/10.1007/978-1-4614-7883-6_458-1

Abstract

Static market power refers to the ability of economic agents profitably to move prices away from competitive levels during one time period. Market power, a form of market failure, prevents the achievement of an efficient allocation of resources. The simplest example of market power is monopoly, a market in which there is only one firm. Another example of market power is oligopoly, a market in which there is a small number of firms. The determination of whether or not prices profitably deviate from competitive levels is at the heart of antitrust law and economics. Methods for analysing the unilateral change in incentives arising from merging two firms have become influential as a screening device for identifying potentially anti-competitive mergers in the EU, US, and UK.

Keywords

Market Power Competition Authority Cournot Model Oligopoly Model Merging Firm 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
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Copyright information

© Springer Science+Business Media New York 2016

Authors and Affiliations

  1. 1.Centre for Energy, Petroleum and Mineral Law and Policy School of Social SciencesUniversity of DundeeDundeeUK