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The economics of antitrust law: a comment on the other contributions to this symposium.

Abstract

This Comment on the other contributions to this symposium addresses their authors' and my positions on (1) the definability of markets and various approaches to defining markets, (2) the definition and legal relevance of market (economic) power, (3) the economic functions and legality of vertical practices (correctly analyzed as a matter of law), (4) the legality of unsuccessful attempts to commit acts whose successful completion would be illegal, (5) so-called "objective intent," so-called "subjective intent," and "specific anticompetitive intent," (6) the relevance of the economic efficiency of conduct or its prohibition to its legality, (7) the defensible goals of antitrust policy, (8) the appropriateness of courts' using decision-rules that minimize the losses generated by the Type I and Type II errors they will make when those rules recommend decisions that would not find defendants liable in a civil case if and only if the preponderance of evidence implies that the defendants violated the law and guilty in a criminal case if and only if the evidence establishes their guilt beyond a reasonable doubt, and (9) the extent to which my "conception" (in one contributor's terms)--i.e., my novel conceptual systems, economic theories, and legal conclusions--in his words "has ended up faring very well"--i.e., has been progressively and now largely accepted by antitrust scholars, antitrust enforcement-agencies, and courts.

Keywords

market definition, market (economic) power, contrived and natural oligopolistic pricing, predatory pricing, horizontal mergers, vertical practices, foreclosure, unsuccessful attempts, "objective intent," "subjective intent," specific anticompetitive intent, lessening competition, economic efficiency, antitrust-policy goals, Type I and Type II errors

Given the embarrassing (though evidently insufficiently embarrassing) length of my introductory essay, (1) I will reduce the length of this Comment by restricting myself to ten points or sets of points raised by the other contributors' articles and referencing whenever possible relevant portions of my introductory essay.

First, the articles of several of the European Community (E.C.)/European Union (E.U.) law experts who contributed to this issue reveal the importance of having detailed knowledge of a body of law both as written and as interpreted and applied as well as of the law's intellectual antecedents, legal antecedents, and legislative history. I do not claim to be a real expert on E.C./E.U. competition law. I devoted a great deal of time to reading and thinking about the competition-law-related provisions of the various E.C./E.U. treaties; the European Commission's (EC's) various competition-law-related Discussion Papers, Notices, Guidelines, and Regulations; EC and E.C./E.U.-court competition-law-case opinions; academic treatises on E.C./E.U. competition law; and specialized academic books and articles on specific or related clusters of E.C./E.U. competition-law issues. I do not think that I reached any incorrect conclusions about the substance of E.C./E.U. competition law, correctly interpreted and applied, and occasionally my outsider perspective made it easier for me to recognize the incorrectness of conclusions of the EC and E.C./E.U. courts about particular legal issues that no European E.C./E.U. competition-law expert appears to have questioned--e.g., the conclusion that now-Article 101 does not cover horizontal mergers that do not create a dominant firm or make a set of rivals collectively dominant. (2) Nevertheless, I recognize that my discussions of various E.C./E.U. competition-law issues would have been enriched had I been aware, for example, of Prof. Akman's research establishing that the original E.C. Treaty was not designed to secure consumer protection, (3) of the adherents of the Ordoliberal school's concern that huge companies might exert undesirable political as well as economic power (which was referenced by Professors Van den Bergh (4) and Zimmer (5)), or of the details of the social and political worries that led to the promulgation and ratification of the Treaty of Rome, (6) to which Prof. Van den Bergh alludes. (7)

Second, a significant portion of Prof. Zimmer's article (8) and all of Prof. Podszun's article (9) are concerned with the proper way to define markets and the role that market definition should play in the application of E.U. competition law. Both take note (10) of my argument that market definitions are inherently arbitrary, not just at their periphery but at their core. (11) However, both seem to believe that a market concept that is properly defined (in Prof. Podszun's case, an "evolutionary" concept of markets) can play a useful role in the application of E.U. competition law. (12) I have little objection to using the term "market" loosely to define an area of product-space that contains products, producers, and buyers to which information pertains that has some bearing on the legality of conduct under E.U. (or U.S.) antitrust law. My objection is to using a protocol to decide antitrust cases that makes salient the magnitudes of market-aggregated parameters (such as a firm's market share or a market's seller-concentration)--i.e., that presupposes an ability to define the relevant market or markets non-arbitrarily. I wrote "little objection" rather than "no objection" because I regret any usage that supports or fails to attack the incorrect and deleterious assumption that markets can be defined nonarbitrarily.

But perhaps Professors Podszun's and Zimmer's inclination to preserve the use of market terminology manifests their desire to be and skill at being effective advocates. This possibility is suggested by Prof. Podszun's claim that the fact that "[t]he European rules on competition law refer to markets or market shares explicitly in several instances" suffice to prove that, at least "from a pure legalistic European perspective, it is impossible to avoid market definition." (13)

I am not persuaded by this claim (any more than I am persuaded by the counterpart claim in the U.S. that the reference in Section 7 of the Clayton Act (14) to lessening competition "in any line of commerce or in any activity affecting commerce in any section of the country"--i.e., the Clayton Act's de facto reference to product and geographic markets--requires at least U.S. courts to adopt market-oriented approaches to applying Section 7 of the Clayton Act). Prof. Podszun provides three examples of interpretively-relevant market-references:

1. Article 102 (15) prohibits the abuse of a dominant position by an undertaking that has " a dominant position within the internal market or in a substantial part of it."

2. At Article 2 paragraph 3, the European Merger Control Regulation (EMCR) prohibits mergers or full-function joint ventures that "would significantly impede effective competition, in the common market or in a substantial part of it"; (16) and at Article 2 paragraph 1, the EMCR instructs the European Commission to take into account "the need to maintain and develop effective competition within the common market in view of, among other things, the structure of all the markets concerned" and "the market position of undertakings." (17)

3. At Article 3 of its block-restraints, (18) the EC declares that the exemptions do not apply if the companies involved have market shares above a specified threshold.

Prof. Podszun could have added other items to this list. For example, Article 101(1) of the Treaty of Lisbon (19) prohibits the categories of conduct it covers if they "have as their object or effect the prevention, restriction or distortion of competition within the common market...."

However, in my judgment, for two reasons, none of the treaty provisions or EC regulations just listed requires the EC or the E.U. courts to adopt market-oriented approaches to applying E.U. competition law or, relatedly, to define any relevant market. First, the relevant provisions' references to "the common market" and perhaps to "the internal market" are references not to economic markets but to the geographic territory to which the relevant treaty or regulation applies. Second, although the EMCR's references to "the structure of all the markets concerned" and the EC's vertical-restraints block-exemption regulations' references to firm market shares do manifest the EC's assumption that markets can be defined nonarbitrarily, I see no reason why the EC and the E.U. courts should not interpret the EMCR's reference to structural features of markets to refer to nonbehavioral features of situations (as opposed to markets) that affect the competitive impacts of mergers and full-function joint ventures and should not interpret the block-exemption regulations' references to market shares to refer to features of the competitive positions of relevant firms that relate to their economic as opposed to their market power (in the false belief that the relevant firms' economic power has some bearing on their specific anticompetitive intent or the competitive impact or distorting impact of the conduct under scrutiny).

The third cluster of issues I want to discuss relates to market power. My study makes eight points or related sets of points about a firm's market power:

1. The study's conclusion that markets cannot be defined nonarbitrarily implies that one should focus on a firm's economic power rather than on its market power. (20)

2. A firm's economic power is a function of both its power over price (its ability to charge prices above its marginal costs) and its power over QV investment (quality-or-variety-increasing investment) (its ability to realize supernormal rates of return on its QV investments in a [somewhat-] arbitrarily defined area of product space). (21)

3. There is no nonarbitrary way to define a firm's economic power over price, a firm's economic power over QV investment, or a firm's economic power over price and QV investment combined after having arbitrarily defined its power over price and its power over QV investment. (22)

4. Even if, contrary to my view, markets could be defined nonarbitrarily, it would not be accurate or defensible to measure a firm's market power or market dominance by its market share. (23)

5. Both the U.S. authorities (24) and the E.C./E.U. authorities (25) have developed and used indefensible abstract definitions and operational measures of a firm's economic power.

6. A firm's preconduct and postconduct economic power is irrelevant to the legality of its conduct under U.S. antitrust law, correctly interpreted and applied, and, correlatively, the various doctrines that the U.S. Supreme Court has developed that assert the contrary position are incorrect as a matter of law. (26)

7. A firm's preconduct and/or postconduct economic power (a) is relevant to the legality under E.U. competition law of its predation and any contrived oligopolistic conduct in which it engages solely by making anticompetitive threats because such conduct is prohibited by Article 102 (which applies solely to dominant undertakings [firms] and---through a contestable interpretation--to the members of a collectively-dominant set of rivals) but not by Article 101 (which applies to all undertakings) (27) and (b) may be relevant to the legality under E.U. competition law of mergers or full-function joint ventures because the EMCR prohibits such transactions if they "would significantly impede effective competition ..., in particular as a result of the creation or strengthening of a dominant position" (28)--a feature of the EMCR that is salient because of the difference between the legal relevance under it of any organizational economic efficiencies a covered transaction generates (see below) and the "efficiency-exemption" to Article 101(1) that is promulgated by Article 101(3). (29)

8. The various market-share-oriented regulations that the EC has promulgated misapply the treaty provisions they are designed to implement cost-effectively. (30)

I want to comment on three of the market-power-related points made in the contributions that other scholars have made to this issue. I start with Prof. Podszun's observation that and EC's and E.U. courts' market definition is connected to the fact that "European competition law is heavily based on the assessment of market power." (31) I take this statement to indicate that E.U. authorities are interested in defining markets because they believe (1) that market definition is part of a cost-effective protocol for determining a firm's economic power or dominance (because it is a prerequisite for calculating a firm's market share and it is cost-effective to measure a firm's market [economic] power by its market share) and (2) that a firm's economic power bears significantly on the legality of its conduct under E.U. competition law, correctly interpreted and applied. I think that the first of these beliefs is wrong and that the EC and the E.U. courts vastly exaggerate the relevance of a firm's economic power to the legality of its vertical conduct under E.U. competition law, correctly interpreted and applied.

I turn next to Prof. Zimmer's discussion of the EC's belief that one can use a firm's market share as a "first indication" of its market power or dominance and two merger partners' market shares as first indicators of the extent to which their merger will create a firm that has more market power than the mergers partner had. (32) I think that both these EC positions are wrong. Firm market shares are not useful "first indicators" of the firm's economic power, and two firms' market shares are not useful first indicators of the extent to which the merged firm will have more economic power than the merger partners would have had. Moreover, it is not cost-effective to base an initial assessment or prediction of these matters of interest on market-share estimates and then revise that estimate to take account of factors that reduce the accuracy of estimates or predictions based solely on market-share figures. The cost-effective protocol would base the relevant estimates or predictions on estimates of the non-market-share parameters whose relevance adjustment-advocates acknowledge. The U.S. 1992 Horizontal Merger Guidelines (33) indicated that--with some exceptions created by the Guidelines' safe-harbor provision, two virtually-irrebuttable presumption-of-legality provisions, and one basically-irrebuttable presumption-of-illegality provision--the Department of Justice (DOJ) and Federal Trade Commission (FTC) would proceed by basing an initial estimate of the relevant merger's likely competitive impact on estimates of market-aggregated parameters--viz., on estimates of the relevant markets' postmerger Herfindahl-Hirschman Index (HHI) figures and on estimates of the merger-generated increases in those HHI figures--and then adjusting those General Standards predictions to take account of relevant Qualifying Factors. As I indicate in my study, this protocol is extraordinarily cost-ineffective: a more complete and accurate variant of "the Qualifying-Factor analysis should be substituted for, not combined with, the General Standards' HHI-oriented analysis." (34) In the real world, "adjustments" will always have to be made, and the approach that the DOJ and FTC indicated in 1992 that they were using required expensive market definitions to be generated, which definitions permitted analysts to calculate HHI-oriented figures that ended up playing no significant role in the final analysis.

I turn lastly under this third topic to Prof. Van den Bergh's comments on the way in which the role that market-power estimates and market-share figures more generally have played in the EC's regulation of vertical practices. Prof. Van den Bergh describes that role accurately and succinctly (35) and then explains that "market shares are at best a crude proxy for market power and no reliable indicator for diagnosing the anticompetitive consequences of vertical restraints." (36) I agree.

The preceding paragraph provides a convenient segue to the fourth set of points I want to make at this juncture: points that relate to (1) the economic functions and effects of various contractual and sales-policy surrogates for vertical integration and of vertical integration itself and (2) the legality of such vertical practices and vertical mergers, acquisitions, and joint ventures under U.S. and E.U. antitrust law, correctly interpreted and applied. My law-study

1. explains that all the above categories of vertical conduct can perform a wide variety of Shennan-Act-licit functions; (37)

2. states that (A) minimum-resale-price-setting resale price maintenance will violate the specific-anticompetitive-intent test of illegality in the rare instances in which it is used by a set of producer horizontal-price-fixers to reduce their members' incentives to reduce their prices or by a set of retailer horizontal-price-fixers to enlist their suppliers' help in enforcing the distributors' horizontal price-fix, (38) (B) vertical territorial restraints will violate the specific-anticompetitive-intent test of illegality in the rare instances in which they are used jointly by a set of producers or retailers to execute a horizontal division of territories or classes of customers defined in some nonterritorial way, (39) (C) package-pricing tie-ins will violate the specific-anticompetitive-intent test of illegality when used to conceal predatory pricing or price-retaliation that violates that test of illegality, (40) (D) non-package-pricing tie-ins and reciprocity agreements will violate the specific-anticompetitive-intent test of illegality in the rare instances in which their employer's ex ante perception that they would be profitable was critically affected by a belief that they would lead an extant rival to exit or relocate further away in product-space from the perpetrator's project or would deter a potential competitor from entering or induce it to locate its entry further away in product-space from the perpetrator's project(s) by increasing the perpetrator's unit sales of the tying good or the good it supplied in the reciprocity arrangement, (41) and (E) long-term exclusive-dealership arrangements, long-term full-requirements contracts, long-term total-output-supply contracts, and vertical mergers and joint ventures will violate the specific-anticompetitive-intent test of illegality when their ex ante perpetrator-perceived profitability was critically affected by their perpetrator's or perpetrators' belief that the conduct would drive a rival out or deter an entry (would "foreclose" competition) but that the conditions under which this requirement would be satisfied are stringent and have been misunderstood, (42)

3. argues that the legality of vertical practices under a lessening-competition test of illegality depends on the competitive impact of a rule allowing all members of a set of rivals to engage in the practice, not on the competitive impact of an individual firm's engaging in the practice (as well as on whether any practice whose availability to a relevant set of rivals would lessen competition would be rendered lawful by its increasing its practitioners' organizational allocative efficiency), (43)

4. contends that a rule allowing all members of a set of rivals to engage in any vertical practice will rarely lessen competition because the practices in question will tend to be more profitable for marginal and potential competitors than for well-established firms and because, even when a particular practice is less profitable for one or more marginal or otherwise-effective potential competitors than for well-established firms in a particular situation, the difference will often not critically affect any marginal competitor's exit or of any potential competitor's entry decision, (44)

5. indicates that, historically, U.S. courts and antitrust-enforcement "agencies" have misanalyzed the legality of vertical practices because they misunderstood their functions and effects, because (relatedly) they promulgated incorrect functional theories (e.g., the leverage theory of tie-ins and reciprocity (45)) and doctrines (the doctrine that distinguishes between consignments and sales (46) or the quantitative-substantiality and qualitative-substantiality tests for determining the illegality of long-term full-requirements contracts and long-term exclusive dealerships (47)), and because (relatedly) they failed to distinguish the legal relevance of decreases in inter-brand competition and decreases in intra-brand competition, (48)

6. argues that, although in the last twenty years or so, the U.S. courts have partially corrected the errors they historically made, they continue to subscribe to the erroneous leverage theory of tieins and reciprocity, (49) the still-imperfect qualitative-substantiality test for foreclosure (which is admittedly superior to the quantitative-substantiality test that it replaced), (50) and the mistaken position that various vertical practices are lawful only if they increase inter-brand competition by more than they decrease intra-brand competition (which is admittedly superior to their historic view that such practices are per se illegal), (51)

7. argues that, with at least one and possibly two or three exceptions, the legality of vertical conduct under Articles 101 and 102 of the Treaty of Lisbon, correctly interpreted and applied, is the same as its legality under the Sherman and Clayton Acts, correctly interpreted and applied--the clear exception is that the conditions that must be satisfied for a firm to obtain an Article 101(3) "efficiency-exemption" in an Article 101 "effect of restricting competition" case are different from the conditions that must be satisfied for a firm to establish either a conventional or a natural-monopoly efficiency "defense" under the Clayton Act, and the two possible exceptions relate to the possibility that Article 102 may promulgate an exploitative-abuse test of illegality that would apply to vertical practices engaged in by any dominant firm or any set of collectively-dominant rivals that has no counterpart in U.S. antitrust law and that Article 101(1) may prohibit unsuccessful attempts to enter into anticompetitive agreements, whereas I believe that the combination of the U.S. judicial practice of not reading attempt provisions into statutes that do not contain them and the failure of the U.S. central government to pass a general attempt-statute imply that neither Section 1 nor Section 2 of the Sherman Act should as a matter of law be read to prohibit unsuccessful attempts to enter into anticompetitive agreements,

8. explains why I reject the various arguments that E.U. officials and scholars have made to justify as a matter of law their conclusion that vertical practices are more likely than I believe they are to violate the Treaty of Lisbon--explains that (A) although the fact that clause (e) of what is now Article 101(1) of the Treaty of Lisbon and clause (d) of what is now Article 102 of the Treaty of Lisbon do manifest the belief of the drafters and ratifiers of the original Treaty of Rome and of all subsequent treaties that amended the Treaty of Rome that vertical practices that impose "supplementary obligations" on a trading party violate the object and/or effect branch of Article 101 (l)'s test of illegality--a conclusion that derives from their mistaken belief that such "obligations, by their nature or according to commercial usage, have no connection with the subject of... [the associated] contracts"), the drafters' and ratifiers' views on this issue have no bearing on the correct application of the relevant treaty-provisions (which make the legality of contracts that create such supplementary obligations depend on whether they do in fact manifest specific anticompetitive intent, restrict inter-brand competition, or distort competition), (52) (B) nothing in the text of the Treaty of Lisbon or its history warrants the conclusion that any tendency of covered conduct to decrease intra-brand competition counts against its legality under E.U. competition law, (53) and economic analysis suggests that the goals of E.U. competition law (however they are plausibly identified) would be furthered by prohibiting conduct that decreases inter-brand competition but not by prohibiting conduct that decreases intra-brand competition, (C) the EC's and EC/E.U. courts' acceptance of the leverage theory of tie-ins and reciprocity (54) is no more defensible than the U.S. courts' acceptance of this theory, (D) the E.U.-competition-law authorities' position that the legality of vertical practices that impose constraints on distributors and consumers is disfavored by their disserving the "liberty" interests of those constrained is undercut by the facts that (i) the relevant constraints do not restrict liberty properly so-called (do not prevent those constrained from making choices or engaging in activities that would contribute to their ability to develop their own respective conceptions of the good or to lead a life in which they fulfill their moral obligations and conform their behaviors to their respective conceptions of the good) and (ii) the constrained individuals accepted the constraints in circumstances in which one could not say that their wills were overborne, (55) and (E) the "market-integration goal"--i.e., the goal of increasing trade between E.C. and then E.U. member-countries in order to reduce the likelihood of war between or among them and to encourage good citizen-to-citizen and government-to-government relations more generally by increasing the extent to which the citizens of different member-countries profit from trading with each other and get to know each other by dealing with each other commercially, by consuming each other's products, and by visiting each other's countries--would not disfavor the legality of many vertical practices whose immediate effect would be to deter trade between member states (e.g., by preventing a distributor in a poor member-country to whom a manufacturer was charging a lower price from reselling the manufacturer's good to a distributor in a richer member-country to whom the manufacturer was charging a higher price) even if this goal were deemed legally relevant to the treaty's interpretation and application because a decision declaring illegal a manufacturer's efforts to prohibit such distributor "parallel trading" would not serve the integrated-market goal, given that (in my admittedly-contestable judgment) the manufacturer would be likely to respond to it by no longer discriminating in favor of distributors in poorer countries, by ceasing to sell its good to distributors in poorer countries, and/or by integrating forward into distribution in poorer countries, (56) and

9. describes in great detail the decisions that the EC and various E.C./E.U. courts have made on various vertical practices in different time-periods, the various Communications and Notices that the EC has issued on vertical practices, and the block-exemption regulations (BERs) that the EC has issued on vertical practices and criticizes the various EC and E.C./E.U. courts' pronouncements on these practices (in part on the ground that the EC gives weight to the perpetrators' market shares and micromanages the affected firms' arrangements from a position of apparent business ignorance). (57)

Two of the contributors to this issue discuss these vertical-practice-related issues. Prof. Akman addresses the arguments that (1) the illegality under Article 101 of vertical practices that impose supplementary obligations on contracting parties is justified by clause (e) of Article 101 (58) and (2) the illegality under Article 101 of vertical practices that harm the consumers directly affected can be established by citing the alleged goal of the Treaty to benefit consumers. (59) She also addresses the question whether Article 101 declares vertical practices prima facie illegal if they decrease intra-brand competition. (60) She seems to find my analyses of these issues always "interesting" and at least sometimes "correct." In fact, in several instances, she supplements my arguments by pointing out that (1) her own research finds that the Treaty of Rome did not have benefiting final consumers as one of its goals (61) and (2) the fact that in 1966 the court in Consten und Grundig gave serious attention to whether Article 101 applies to vertical restraints "suggests that as originally conceived it was at least ambiguous whether Article 101 TFEU would apply to these restraints at all...." (62) Prof. Akman also points out that my position that Article 101 does not prohibit firms from reducing intra-brand competition is strengthened by the fact that efforts to keep manufacturers from controlling intra-brand competition are likely to lead the manufacturers to make moves (63) (e.g., as I suggest, (64) to integrate forward into distribution or increase their per-unit prices and reduce their lump-sum franchise fees) that are not in the interest of final consumers.

In his article on vertical restraints, Prof. Van den Bergh also agrees with many of the positions I take on these issues: he (1) recognizes that all the vertical practices he considers can perform legitimate functions (65) and (2) explains why "it is highly questionable whether competition law is an appropriate tool to further market integration"--inter alia, because attempts to further market integration may be self-defeating (given the behavior that the law's addressees are likely to substitute for forbidden vertical practices) and may in any event harm relevant consumers and reduce economic efficiency. (66) However, although Prof. Van den Bergh recognizes that, as a matter of policy, the legality of vertical restraints should be determined by their economic consequences (67) (inter alia, by their effects on economic efficiency, consumer welfare, and inter-brand competition) and that "it may be deplored" that the EC has not discussed the "tensions" between achieving the goal of market integration and achieving the goals of increasing competition, improving allocative efficiency, and increasing consumer welfare, (68) he does not address the possibility that the legality of vertical practices under E.U. competition law, correctly interpreted and applied, may depend (exclusively) on their perpetrators' motives, the conduct's impact on inter-brand competition, and the conduct's tendency to distort competition. Perhaps his not doing so reflects a belief that the facts that (1) Article 3 of the Treaty of Lisbon indicates that one goal of the treaty is to establish an internal market (69) and (2) the European Court of Justice has refused "to downscale the importance of the market integration goal" (70) render such an argument incorrect as a matter of law. I must say that, for at least three reasons, I would not find such an argument convincing. First, the relevant Article 3 text is not particularly generous or forceful--it simply indicates that "[t]he Union shall have exclusive competence in... the establishing of the competition rules necessary for the functioning of the internal market...." Second, at least in the United State, arguments that focus on statutory or treaty proclamations of statutory or treaty goals do not override arguments that focus on what would otherwise be statutory/treaty text that promulgates cognizable tests of illegality, and administrative-agency and judicial holdings that misinterpret the law are not self-validating--should as a matter of law be deemed to affect what the law is in a future case only to the extent that a non-government actor reasonably relied on the misinterpretation. Third, I would think that judicial and "administrative" misinterpretations would be less self-validating in the E.U. than in the United States since the E.U. primarily contains civil-law countries and judicial decisions in civil-law jurisdictions supposedly have no precedential weight. But perhaps the real reason that Prof. Van den Bergh does not investigate the implications of his policy arguments for the legally-correct interpretation and application of E.U. competition law is that he believes that any such effort would have no chance of persuading the EC and the E.U. courts. His judgment on that issue would clearly be better than mine.

The fourth set of points I want to make in this Comment are two points that relate to the conceptual systems that the antitrust-law study and my previous work develop. These conceptual systems respectively (1) break down into components whose determinants should be separately analyzed the gap between a seller's price and its marginal cost (71) and (2) distinguish various intermediate determinants of the intensity of QV-investment competition in any area of product space (the competition firms wage by introducing additional quality-or-variety-increasing investments in a stipulated area of product-space) that should also be separately analyzed. (72) The antitrust-law study uses these conceptual systems for a wide variety of purposes--inter alia,

1. to distinguish the category of conduct I call "oligopolistic" (conduct that is initiated by an actor's making a move it would not have perceived to be profitable ex ante but for the actor's belief that its rivals' responses would be or might be affected by their perception that it could react to their responses) from other categories of interdependent decision-making, (73)

2. to distinguish contrived oligopolistic conduct (which involves an initiator's making an anticompetitive offer and/or threat) from natural oligopolistic conduct (which does not), (74)

3. to generate abstract definitions of the concepts of predatory prices, (75) predatory QV investments, (76) and predatory cost-reducing investments in production-process research, new-plant construction, and plant-modernization, (77)

4. to generate operational definitions of a firm's highest nonoligopolistic price, (78) highest non-contrived- oligopolistic price, (79) and lowest nonpredatory price, (80)

5. to provide the grounding for analyses of the determinants of the profitability of contrived oligopolistic pricing, (81) the determinants of the feasibility of natural oligopolistic pricing, (82) and the determinants of the profitability of predatory pricing (83) and predatory investments of various kinds, (84)

6. to generate tests for contrived oligopolistic pricing, (85) natural oligopolistic pricing, (86) predatory pricing, (87) and predatory investments of various kinds (88) and critiques of the tests for these kinds of conduct that other scholars have proposed and/or that courts and other types of antitrust-enforcement authorities have used and/or considered, (89)

7. to analyze the impact that any choice-among-known-production-processes-related, QV-investment-related, and production-process research (PPR)--related organizational economic efficiencies that a merger or joint venture did or would generate did have or would have on Clayton-Act-relevant buyers, on the profits the perpetrators realized, and on economic efficiency (analyses that differ with both the type of organizational economic efficiency generated and the category of impact investigated), (90)

8. to analyze more generally whether merger partners or joint venturers had specific anticompetitive intent and the competitive impact of mergers or joint ventures (be they horizontal, conglomerate, or vertical), (91) and

9. to analyze the circumstances in which certain vertical contract-clauses and sales policies and vertical integration will "foreclose competition" in a sense that makes the legality of the conduct in question problematic. (92)

I believe that the uses I have made of my conceptual systems justifies them--carries the burden that any conceptual innovator bears of proving that his concepts are sufficiently useful to outweigh the cost of learning the definitions of the relevant terms and learning how to apply the concepts in question.

One of the contributors to this issue points out the prominent role that the novel conceptual systems I have developed play in my analyses: Prof. Harrison refers to the fact that the way in which I express my "extraordinarily complex ideas" is "even more complex" than my ideas and quotes a passage from page 525 of Economics and the Interpretation and Application of U.S. and E. U. Antitrust Law, Vol. I: Basic Concepts and Economics-Based Legal Analyses of Oligopolistic and Predatory Conduct (hereinafter Markovits I) to illustrate this claim (a passage that contains several acronyms that have, of course, been defined and explained earlier in the Markovits I text). (93) However, only one of the eight contributors to this issue other than myself make any use at all of my conceptual systems: Prof. Brennan references the legal significance (in various sorts of cases) of the frequency with which two firms are "the first and second best options for buyers" (94) and pays some attention to my concept of QV-investment competition. (95) The other contributors to this issue do not make reference to, much less use, any of my conceptual systems. In part, their failure to do so reflects the fact that the concepts in question are not needed to discuss the issues on which they are focusing--inter alia, the legal relevance of subjective intent, the role that market definition has played and seems likely to continue to play in the application of U.S. and E.U. antitrust law, the private functions and competitive impact of various types of vertical practices, the role that the goal of creating an integrated market has played and seems likely to continue to play in the interpretation and application of E.U. competition law, the policy disadvantages of deciding civil/criminal antitrust cases by determining whether the defendant(s) is/are (more likely than not)/(likely beyond a reasonable doubt) to have violated the law, etc. But that is at best a partial explanation: even when contributors agree with economic and legal conclusions that I generate by using my conceptual schemes and that I do not think can be established without using those schemes, they do not make reference to my concepts or the arguments I use them to make.

Professor Harrison offers the more persuasive (and not surprising) explanation for the contributors' failure to use my conceptual systems. After quoting the previously-cited passage from Markovits I that references several of my concepts and the acronyms I use to stand for them, Prof. Harrison states: "I don't think many will disagree that there are 'application' costs associated with any theoretical work and that these costs discourage further examination of the ideas expressed." (96) Perhaps I should take some solace from Prof. Brennan's report that the unconventional arguments and conclusions he heard me offering the Antitrust Division in the Spring of 1979 (my "conception") "has ended up faring very well." (97)

The fifth set of issues I want to address in this Comment relates to whether the U.S. Sherman Act and E.U. competition law cover unsuccessful attempts to engage in conduct whose successful execution would violate the laws in question. In my law-study, I argue that (1) as its text states, Section 2 of the Sherman Act does cover unsuccessful attempts to monopolize and (2) whether Section 1 (or Section 2) covers unsuccessful attempts to enter into agreements in restraint of trade, etc., is contestable. The argument against their covering unsuccessful attempts to enter into such agreements is based on three facts: Section 1 does not explicitly cover attempts, the U.S. central government has never passed a general attempt-statute, and U.S. courts have steadfastly refused to read attempt-provisions into federal statutes that do not contain them. (98) Markovits / offered no opinion on whether it would be correct as a matter of law to interpret Articles 101 and 102 to prohibit unsuccessful attempts to engage in conduct that would violate their respective tests of illegality if successfully completed because I was unable to determine whether the E.C. or E.U. had a general attempt-statute, whether individual E.C./ E.U. member-countries had passed general attempt-statutes, and--if the E.C./E.U. or any member-country have not passed a general attempt-statute--whether and under what circumstances the courts of the E.C./E.U. and/or of the relevant member-countries have read attempt-provisions into non-criminal statutes that do not contain them.

My law-study also gave four "policy" reasons for prohibiting unsuccessful attempts to violate the Sherman Act or any other legal provision that prohibits conduct motivated by specific anticompetitive intent:

1. such conduct is immoral, and it is a moral good to punish people or even to "call them out" for engaging in immoral conduct;

2. unsuccessful attempts to enter into at least some categories of anticompetitive agreements (e.g., agreements to charge contrived oligopolistic prices) do have bad consequences (relevant consumers are harmed when a business makes an offer to enter into a unilateral contract to fix prices that the offeree rejects by undercutting the offeror's contrived oligopolistic price because the offeree's undercutting offer to the relevant buyer is less attractive to that buyer than the offer that the offeror would have made to that buyer had it not tried to contrive an oligopolistic price); (99)

3. under the Sherman Act (though not under Articles 101 and 102 of the Treaty of Lisbon), a legal holding that unsuccessful attempts to engage in illegal behavior are illegal will yield a benefit sounding in corrective justice by enabling the victims of such unsuccessful attempts to obtain redress from their wrongdoing injurers; and

4. penalizing actors that make unsuccessful attempts to violate the law will deter all attempts to violate the law (successful as well as unsuccessful attempts to violate the law).

Two of the other articles on which I am commenting contain statements that relate to this attempt-question. Prof. Harrison's article on the Supreme Court's requirement that, to escape summary judgment against them, plaintiffs in predation cases must establish that the defendant had market power before and/or after engaging in the allegedly-predatory conduct references the Supreme Court's somewhat-related position that it will not find conduct illegal under the Sherman Act unless it creates a "dangerous probability" that it will succeed in increasing the perpetrator's monopoly power (or in giving the perpetrator monopoly power). (100) Prof. Harrison does not ask whether this doctrine is correct as a matter of law (a question that, to be fair, is orthogonal to his analysis). Obviously, I think that, as a matter of law, covered conduct undertaken with specific anticompetitive intent violates the Sherman Act, regardless of its probability of success--that, in Prof. Brennan's words, the Sherman Act is about "character." (101)

Prof. Akman addresses the policy desirability of moving against unsuccessful attempts (in passages that are directly concerned with the wisdom of prohibiting conduct that manifested specific anticompetitive intent but did not succeed): "the question ... remains even where the conduct of an (dominant) undertaking cannot be explained by anything other than the intention to eliminate competitors, why this should matter so long as competitive harm (in the form of effects on the market) cannot be demonstrated." (102) I assume that Prof. Akman would find it desirable to move against unsuccessful attempts that harm relevant consumers (as I have argued unsuccessful attempts to enter into unilateral horizontal-price-fixing contracts will do) because they would generate "effects on the market." However, I take it that she would not think it desirable to bring cases against firms that engaged in conduct that violated the object-branch of Article 101 's test of illegality or the exclusionary-abuse branch of Article 102's test of illegality without causing any "effect on the market" (in that their attempts were unsuccessful) to make public the fact that the firms had engaged in immoral behavior and to reduce the ex ante incentives of firms to make such attempts. I disagree.

The sixth set of points I want to make in this Comment relates to positions that other contributors have taken on the specific-anticompetitive-intent test of illegality that I argue operationalizes (1) the Sherman Act's prohibitions of restraints of trade, attempts to monopolize, and monopolization, (2) the object-branch of Article 101's test of illegality, and (3) the exclusionary-abuse branch of Article 102's test of illegality. I will start with some clarification. Prof. Brennan's claim that the fact that my operationalization declares conduct to violate these tests of illegality if its perpetrator's or perpetrators' ex ante estimate of its profitability was "critically inflated" (actually, would be critically inflated if the profits yielded by the relevant conduct and hence the relevant actor's or actors' profit-prediction would not otherwise diverge from the economic efficiency of the conduct in question) by its or their perception that it would or might reduce the absolute attractiveness of the offers against which it or they would have to compete for reasons that would render the conduct more profitable than economically efficient does not imply that the perpetrator or perpetrators in question were suffering from "a kind of delusion." (103) Although perpetrator(s) whose conduct violates the specific-anticompetitive-intent test of illegality may have misestimated the Sherman-Act-illicit and/or the Sherman-Act-licit profits their conduct would generate, the test renders theoretically irrelevant the erroneousness of their estimates of these profits, and (I am quite confident) in the vast majority of cases the relevant actor's or actors' choices will not have been critically affected by any such errors.

I move next to the concept of "intent" and the related expressions "subjective intent" and "objective intent." On my operationalizations, the legality of covered conduct under the Sherman Act, the object-branch of Article 101, and the exclusionary-abuse branch of Article 102 is critically affected by the perpetrator's or perpetrators' "specific anticompetitive intent," which in my (normal) usage is always "subjective." Both in the U.S. and in the E.U., (104) the expression "objective intent" is sometimes contrasted with the redundant expression "subjective intent." I suppose that one could (as U.S. and E.U. authorities appear to have done) define the expression "objective intent" to refer to those effects of a choice from which one can infer the chooser's (subjective) intent and use the redundant expression " subjective intent" to refer to evidence that relates to oral and written statements an actor made that bear on the actor's intent. I find these locutions confusing and therefore unfortunate. However, I fully acknowledge (105) (1) that linguistic evidence of subjective intent is often ambiguous and (2) that, both for this reason and because of its actual relevance, evidence of effects (so-called "objective evidence of intent") is often more probative of the legally-relevant intent (which is subjective) than is linguistic evidence of (subjective) intent--i.e., that, in Prof. Akman's words, it may be most cost-effective to determine (subjective) intent by using objective evidence of effects to determine "whether a reasonable person situated as the defendant would have acted in the way the defendant acted without the intention imputed to her." (106)

I also want to emphasize that my specific-anticompetitive-intent test does take full account of the reality on which the "ethical 'doctrine of double effect'" to which Professor Brennan refers (107) focuses (the reality that two or more sufficient motivations for a given choice may be operative): according to the specific-anticompetitive-intent test, the fact that a choice generates profits for its perpetrators) in a Sherman-Act-illicit way (indeed, although this is not a necessary condition for illegality, the fact that such illicit profits would suffice in themselves to make the choice profitable) does not render it illegal if the chooser believed ex ante that it would generate sufficient Sherman-Act-licit profits to be ex ante profitable on their account alone.

Finally, under the intent heading, I want to comment both (1) on Prof. Akman's claim that the conduct whose legality is at issue in Article 102 cases "is unilateral and therefore involves no mental element that makes it objectionable in and of itself in contrast to prohibited practices under Article 101 ... where the mental state of parties, having, for example, agreed to distort, reduce or prevent competition might matter" (108) creates "problems with using intent as the central concept of' the exclusionary-abuse branch of Article 102's test of illegality and (2) on the conclusion she reached in a previous study "that there is no role for intent in the EU prohibition of abuse of dominance...". (109) For two reasons, I find this argument completely unpersuasive: more importantly,

(1) individual-firm conduct is as capable of manifesting specific anticompetitive intent as is multifirm conduct and, less importantly, (2) at least as interpreted, Article 102 applies to multifirm conduct (indeed, to the conduct of one or more members of a set of rivals that are collectively dominant).

What has led Professor Akman to make this argument and reach (for the above and other reasons) this conclusion? Since Prof. Akman perfectly understands both the meaning of and the policy justification for the specific-anticompetitive-intent test that I think operationalizes, inter alia, the exclusionary-abuse branch of Article 102's prohibition of "abuses of dominance" and I am confident that my operationalization is correct as a matter of law (an ipse dixit that has only subjective significance), I am perplexed by her rejection of my interpretation. Here are some of the other arguments that might have led her to her conclusion: in Prof. Akman's words,

1. "according to the ultimate arbiter of EU law, namely the Court of Justice (CoJ), 'abuse' is an 'objective concept' relating to [whether] the behavior of a dominant undertaking ... has the effect of hindering the maintenance of the degree of remaining competition or the growth of that competition," (110)

2. "using (subjective) intent [in my words, using intent as opposed to effects] to find a practice anticompetitive poses serious risks for legal certainty," (111)

3. "if the concern is indeed with the effects of conduct on the market, then what the added value of establishing [subjective] intent is as opposed to directly establishing the existence or lack of effects on the market is unclear," (112) and

4. "the EU authorities' position on the efficiency defence to Article 102 TFEU also implies that competition on the merits can constitute exclusionary abuse." (113)

My response to the first and fourth of these points is that the holdings of the Court of Justice and the E.U. authorities are not self-validating: the fact that they say something does not make their statement correct as a matter of E.U. law. My response to the second of these points is that (less importantly) I see no reason to believe that the use of linguistic evidence in the E.U. system, in which judges are making the decisions, would create more risk than the use of effects-evidence would do and that (more importantly) the issue of whether Article 102 creates a (subjective) intent test of illegality or an effects test of legality is a different issue from the issue of whether or the extent to which (subjective) intent should be inferred from linguistic statements or from effects. And my response to the third of these points is that I reject its premise that "the concern" is solely with "the effects of conduct on the market"--that, in my judgment, the Sherman Act's tests of illegality, the object-branch of Article 101's test of illegality, and the exclusionary-abuse branch of Article 102's test of illegality are also concerned with condemning (i.e., also seek to condemn) actors that or who have committed immoral acts even if the immoral conduct in question has not produced bad effects.

I turn seventh to the positions that other contributors have taken on the relevance of the economic efficiency of conduct (or its prohibition) to its legality under U.S. and E.U. antitrust law. My study (1) defines the impact of a choice on economic efficiency, (114) (2) explains that competition-law-covered conduct can affect economic efficiency both by increasing the organizational economic efficiency of its perpetrator(s) and by increasing or decreasing various categories of economic efficiency in other ways--viz., by increasing or decreasing inter-ARDEPPS and intra-ARDEPPS UO-to-UO misallocation where "ARDEPPS" stands for arbitrarily-defined portion of product-space and "UO" stands for unit output, by increasing or decreasing inter-ARDEPPS and intra-ARDEPPS QV-to-QV misallocation where "QV" stands for quality-or-variety-increasing investment, by increasing or decreasing inter-ARDEPPS and intra-ARDEPPS PPR-to-PPR misallocation where "PPR" stands for production-process research, by increasing or decreasing the misallocation unit-output producers generate by using known, higher-allocative-cost production processes rather than known, lower-allocative-cost production processes, by increasing or decreasing the amount of misallocation generated by the actual allocation of final goods among their potential consumers for reasons that either do or do not reflect the amount of poverty and income/wealth inequality associated with the allocation of final goods among their potential consumers in the society in question, and by increasing or decreasing the amount of allocative transaction costs generated in the relevant economy, the amount of risk and uncertainty costs (which are both private and allocative) generated in the relevant economy, the amount of allocative costs that the society's members and participants generate to reduce the risk and uncertainty costs they bear, and the amount of economic inefficiency the government generates when financing its operations, (115) and (3) analyzes the relevance of the impact that conduct can have on these various categories of economic efficiency and allocative costs to its legality under U.S. and E.U. antitrust law. (116) With some minor qualifications, I conclude that the fact that conduct increases the organizational allocative efficiency of its perpetrator's or perpetrators' production-process choices, QV-investment-creation choices, and/or PPR-execution choices favors its legality under both a specific-anticompetitive-intent test of illegality (since the conduct will yield its perpetrators] Sherman-Act-licit profits on that account) and a lessening-competition test of illegality (since the conduct will tend to benefit Clayton-Act-relevant buyers on that account). However, the fact that conduct decreases or increases the other categories of economic inefficiency or allocative costs just listed is irrelevant to its legality under both a specific-anti-competitive-intent test of illegality (since it does not suggest anything about the magnitude of the Sherman-Act-licit profits the conduct would generate or did generate) and a lessening-competition test of illegality (since it does not suggest anything about the conduct's net equivalent-monetary impact on Clayton-Act-relevant buyers).

Three of the contributors address either my position on the relevance of the impact of conduct on economic efficiency to its legality and/or the positions that antitrust-enforcement authorities have taken on this issue. Thus, Prof. Akman states correctly: "Notwithstanding the fact that Markovits suggests that the relevant tests of illegality that he argues are correct as a matter of law are not based on economic inefficiency, the tests still contain an important element of economic efficiency." (117) As I just indicated, that important element relates to the (indirect) legal relevance of any organizational economic efficiencies conduct generates. Prof. Akman also states that my position on this issue is different from
   the EU approach in which efficiency is only a secondary concern--if
   taken into account at all. This is because particularly under
   Article 102 TFEU that the conduct increases economic efficiency can
   only be argued and has to be proved as a defence by the perpetrator
   [citing Guidance on the Commission's Enforcement Priorities in
   Applying Article 82 (now Article 102) of the EC Treaty to Abusive
   Exclusionary Conduct by Dominant Firms, OJ C45/7 (28)-(31) (2009)].
   Thus, efficiency is not taken into account in the proof of abuse
   itself and thus, is not included in the test of what makes conduct
   anticompetitive despite arguments to this effect in the literature
   [citing at her note twenty-three various scholarly articles and
   books]. (118)


Prof. Akman's statement (which I quoted previously and cited at my footnote number 116) that "the EU authorities' position on the efficiency defence to Article 102 TFEU also implies that competition on the merits can constitute an exclusionary abuse" is relevant here as well. My response: the E.U. authorities' making these legal claims does not make them correct as a matter of law. I know I have said this before, but as Mr. Justice Scalia once said at the beginning of a talk I heard him give: "I can be either consistent or boring. I choose to be boring."

Prof. Van den Bergh states (with regret) that the combination of the EC's conclusion that the paramount goal of the Treaty on the Functioning of the European Union (TFEU) is to promote market integration within the common market and its "deplor[able]" refusal to discuss "the multiple tensions between [pursuing this] goal" and pursuing other goals such as increasing competition, increasing economic efficiency, and benefiting relevant consumers has led it to prohibit vertical conduct that increases its practitioners' organizational economic efficiency. (119) My response will come as no surprise: the fact that the EC has reached this conclusion and has refused to consider its consequences does not make its position correct as a matter of E.U. law.

Finally, Prof. Hylton takes the following relevant positions:
   Looking at the law, distributive justice plays virtually no role in
   American antitrust law. The efficiency rationale has dominated the
   antitrust discourse within the U.S. courts. But it is different in
   the European Union. The EU does not have antitrust rules that
   explicitly incorporate distributive justice consequences, but one
   can read some of the rules as implicitly incorporating distributive
   justice causes (citing predatory pricing rules "shielding less
   efficient firms ..., [thereby creating] "a greater likelihood" "of
   [the employees of such firms] "remaining in their jobs"). (120)


I would add that Article 101(3) of the E.U. treaty does evince a greater concern with distributive effects than any provision of U.S. antitrust law explicitly evinces by declaring that perpetrators of conduct covered by Article 101(1) can take advantage of the exemption (efficiency defence) Article 101(3) provides for only if (inter alia) the conduct "allow[s] consumers a fair share of the resulting benefit." (121) I would also add that the EC's and the E.C./E.U. courts' concern with distributive issues is manifest as well both in their interpreting Article 102 to prohibit not only exclusionary abuses of a dominant position but also exploitative abuses of a dominant position (122) and in their confusing and inconsistent treatment of "competition on the merits." (123)

The eighth set of points I want to address relates to the defensible goals of antitrust policy. These goals include:

1. increasing economic efficiency (which is a proximate goal since increases in economic efficiency are not morally valuable in themselves),

2. deterring individuals from committing immoral business acts motivated by specific anticompetitive intent, punishing individuals and firms that have committed such immoral business acts, and giving the consumer and business-rival victims of such acts the ability to obtain redress from the wrongdoers who or that have harmed them,

3. redistributing income from shareholders, managers, and workers in their capacities as workers to consumers (which may be deemed desirable from a variety of distributive-justice perspectives),

4. reducing the role that prejudices and parochial favoritism play in hiring and promotion processes (by reducing the incomes of a firm's managers and workers, hence reducing the tax-rate applied to their marginal earned incomes, hence increasing the after-tax cost to them of accepting lower gross wages to secure hiring and promotion choices that satisfy their prejudices or favor those for whose welfare they have positive external preferences),

5. increasing the extent to which the relevant society instantiates the liberal principle that each of its competent members should have the same influence on the passage and implementation of the society's laws (despite the theory of countervailing power) by decreasing income/wealth inequality and reducing the profits of particular firms and concentration of sets of firms with common interests and therefore their political influence, and (possibly)

6. encouraging commerce among the member-countries of a confederation to reduce the probability of war, to increase the probability and extent of useful political cooperation, to broaden the experiences and perceptions of the relevant countries' members, and to reduce cross-country prejudice. (124)

Of course, the content of an optimal antitrust law and the analysis of the amount of resources that would be optimal to devote to implementing such a law's various provisions will depend not only on the goals the law is designed to achieve but also on the law's creators' or ratifiers' or supporters' view of the trade-offs between the achievement of these goals that would be optimal to make over different ranges of their effectuation. I will make no effort to address here this latter complex and difficult issue.

A number of the contributors to this issue list various goals that they think that antitrust law should or should not be designed to achieve, and some reference the need to decide how these goals should be traded off against each other. Thus, Prof. Van den Bergh (1) references the goals of increasing economic efficiency, benefiting (Clayton-Act-relevant) buyers, preventing the growth of firms that would have undue political influence, and securing market integration, (2) calls attention to the need to consider the "tensions" between securing market integration and achieving the other goals just listed, and (3) questions the efficaciousness of competition policy at achieving the market-integration goal. (125) (I have no doubt that Prof. Van den Bergh would agree that competition policies that prohibit horizontal market divisions that assign each country to a particular seller [perhaps the seller located within it] will promote the market-integration goal.) Prof. Podszun references the goal of benefiting "end-consumers" (by which I think he means, in my terms, Clayton-Act-relevant buyers). (126) Prof. Zimmer references the goals of preventing the growth of large companies that might exert an undue "influence on the political process" and benefiting what I call Clayton-Act-relevant buyers (which he calls increasing "consumer welfare"). (127) Prof. Akman references increasing economic efficiency, benefiting what I call Clayton-Act-relevant buyers, securing distributive justice, deterring conduct that is rendered immoral by its perpetrator's or perpetrators' specific anticompetitive intent, and securing corrective justice. (128) Prof. Brennan states that he thinks that antitrust policy should seek to increase economic efficiency, to benefit "consumers" (by which I think he means buyers whom I call Clayton-Act-relevant buyers), and to benefit producers that would otherwise be harmed by competition that is not competition on the merits but that antitrust policy should not seek to deter conduct that manifests its perpetrators' specific anticompetitive intent except to the extent that it has "observable competitive effects on consumers ... and producers" (rejects the standard lawyer claim that, inter alia, "antitrust is about character"). (129) As we have already seen, (130) Prof. Hylton references the possibility that antitrust laws could be created both to increase economic efficiency and to further distributive justice. (131) Although my colleague Prof Abe Wickelgren says nothing directly about the goals that he thinks antitrust law should be designed to achieve, he does state "that Congress's goal in establishing the [U.S.] antitrust laws was to reduce anti-competitive behaviors and improve the competitiveness of the economy...." (132) Finally, while openly acknowledging that attorneys "may view antitrust as the pursuit of bad actors, that is, those with malicious intent," "regardless of harm"--that attorneys think that "antitrust is about character," about "bad guys"--Prof Brennan states that (like most economists) he thinks that antitrust policy should focus on preventing bad economic effects and generating good economic effects. (133) Perhaps because I am both a lawyer and an economist, I think that as a matter of policy antitrust should be about both character and effects.

The ninth set of comments I want to make about the articles of other contributors to this symposium consists of three points that relate to the distinctions among (1) analyzing the interpretations of extant statutes and treaty-provisions that are correct as a matter of law, (2) analyzing the operational decision-rules for applying a given law's test of illegality that would best effectuate the goals of the law, given the Type I and Type II errors that would be associated with each possible decision-rule where the referenced "errors" are case-resolutions that differ from the resolutions that would be warranted by an accurate application of the adopted decision-rule, and (3) analyzing the tests of illegality and operational decision-rules that would be optimal for a government to legislate. The first of these three points is that Prof. Wickelgren's article focuses on the second of these three tasks--more specifically, analyzes the difference between (1) the operational decision-rule for applying U.S. antitrust law as it applies to predation that would best secure the law's goals and (2) the decision-rule that would constrain a court to find one or more defendants guilty of predation if and only if, in a civil suit, the preponderance of the evidence favored the conclusion that it or they had engaged in predation and if and only if, in a criminal case, the evidence established that it or they had engaged in predation beyond a reasonable doubt. (134) Indeed, Prof. Wickelgren's article is valuable precisely because, unlike the other articles in the literature that execute the second category of analysis just defined, Prof. Wickelgren's article both (1) clearly articulates the abstract difference between the first two decision-rules abstractly defined in the immediately-preceding sentence and (2) explores the operational differences between these two categories of decision-rules in predation cases. Prof. Wickelgren's article is practically valuable because (1) at least in the U.S., it is certainly permissible and may be desirable for antitrust-enforcement agencies to bring cases if and only if they conclude that doing so will secure the goals of a relevant statute and (2) it may be morally and constitutionally permissible and desirable for a legislature that wants to prohibit a category of conduct to achieve particular goals to pass legislation whose prohibition is overinclusive and/or underinclusive when doing so will further the extent to which the goals in question are secure. (135) However, I do want to emphasize that, in my judgment, courts are not authorized to use statutory/treaty-goal-securing decision-rules if their use of them increases the erroneousness of their resolution of cases from the perspective of the test of illegality actually promulgated by the applicable statute-provision or treaty-provision--i.e., from the perspective of generating resolutions of civil cases that deviate from the resolutions under which the defendant would be found liable if and only if the court concluded that, more likely than not, his, her, or its conduct was covered by the relevant "law" and violated the promulgated test of illegality and of generating resolutions of criminal cases that deviate from the resolutions under which defendants would be found guilty if and only if the court concluded that, beyond a reasonable doubt, they had engaged in conduct that was covered by the relevant law and that violated its promulgated test of illegality. Indeed, I think that it is a prima facie violation of the moral rights of either the disfavored defendant or the disfavored plaintiff in a civil case for a court to substitute a statutory/treaty-goal-securing decision-rule for the promulgated decision-rule when the use of the substituted decision-rule increases the probability that an erroneous decision will be made from the perspective of the promulgated decision-rule and a violation of the moral right of the defendant in a criminal case for a court to substitute a statutory/treaty-"goal-securing" decision-rule for the promulgated-test-of-illegality decision-rule when the substitution of the goal-securing decision-rule for the promulgated decision-rule disfavors the defendant ex ante and/or disfavored the defendant ex post. In essence, I am arguing that it is just for government actors to resolve cases in the way that maximizes the extent to which statutory or treaty goals are secured only within the constraint imposed by the moral rights of the litigants in a civil case and of the defendant in a criminal case and that the party in a civil case whose claim is favored by the preponderance-of-the-evidence rule that focuses on the promulgated test of illegality has a moral right that the promulgated test of illegality be used to resolve his or her case and that a defendant in a criminal case has a moral right to be found guilty if and only if his or her guilt is established beyond a reasonable doubt under the promulgated test of criminality.

Second, I want to point out that Prof. Hylton (who like Prof. Wickelgren, Prof. Harrison, and me is both a Ph.D. economist and a lawyer) shares Prof. Wickelgren's view that it is appropriate for courts to develop doctrines whose implementation will best accomplish the goals of the antitrust laws (presumably even when those doctrines are self-consciously overinclusive and/or underinclusive): "In the end, I think the goal of the antitrust scholar, and of the courts, is to define rules to help avoid costly errors-that is, error cost minimizing rules." (136)

Third, I want to point out that both Prof. Akman (137) and Prof. Harrison (138) reference Type I and Type II errors (or false-negative and false-positive errors) in passages that suggest that they believe that it is desirable for courts to use operational decision-rules that increase the extent to which statutory/treatygoals are secured even when these decision-rules increase the probability that the statute or treaty will be applied incorrectly to the individual case (increase the probability that a defendant in a civil case will be found liable or be enjoined from engaging in particular conduct) or (will not be found liable or not be enjoined from engaging in particular conduct) when the preponderance of the evidence does not favor the conclusion in question under the promulgated test of illegality or increase the probability that a defendant in a criminal case will be found guilty even when the evidence does not prove his or her guilt beyond a reasonable doubt.

Fourth and lastly in this ninth category, I want to point out that at least some contributors tend to shift from analyses of the way to interpret or apply existing statutes that is correct as a matter of law to analyses of the optimal way to regulate the conduct in question without explicitly indicating that they have changed their focus. Space considerations deter me from justifying this claim by examining relevant passages in the articles I have in mind.

Tenth and finally, I want to return to Prof. Brennan's claim that my "conception"--i.e., the concepts I developed, arguments I made, and conclusions I reached in my 1979 Antitrust Division lecture on horizontal mergers--"has ended up faring very well." (139) My study presents detailed accounts and critiques of the DOJ/FTC 1992 Horizontal Merger Guidelines' approach to horizontal-merger analysis and of their 1997 revision of those Guidelines, (140) of the DOJ/FTC 2010 Horizontal-Merger Guidelines, (141) of the 2004 EC Guidelines on the assessment of horizontal mergers, (142) and of the EC's and E.C./E.U. courts' relatively contemporary horizontal-merger cases (horizontal-"concentration" cases in E.U. lingo). (143) I will restrict myself here to considering whether the relevant government authorities have accepted my approaches to and conclusions about the seven most salient issues I addressed in my 1979 lecture.

The first point I made in 1979 was that both antitrust-market definitions and classical-market definitions are inherently arbitrary not just at their periphery but at their core and that therefore one should use non-market-oriented approaches rather than market-oriented approaches to predicting the competitive impact of any horizontal merger or any other category of business conduct (or to assess whether any exemplar of any category of business conduct manifests its perpetrator's or perpetrators' specific anticompetitive intent). In other words, I argued that one should use decision-protocols that do not focus on the magnitudes of parameters whose definition presupposes the possibility of defining markets nonarbitrarily--parameters such as seller market shares, traditional seller-concentration ratios, postmerger HHI figures, or merger-generated increase-in-HHI figures. (144)

Has this position carried the day? I start with the 1992 U.S. Guidelines. The U.S. 1992 Horizontal Merger Guidelines (even after their 1997 Revision) are substantially market-oriented: they (1) devote considerable attention to developing a (poorly-drafted) abstract definition of a relevant antitrust market and articulating a protocol for identifying the products that should be placed in such a market, (2) articulate in their General Standards' section a de facto irrebuttable presumption of legality and a difficult-to-rebut presumption of illegality that focuses exclusively on market-oriented parameters (the postmerger HHI of a relevant market and the merger-generated increase in the HHI of that market), and (3) more generally, assume that even when non-market-oriented parameters (Qualifying Factors) will be taken into account, they will be used to adjust initial conclusions generated solely from the magnitudes of the above market-aggregated parameters. I move next to the EC 2004 Guidelines. The EC Guidelines define antitrust markets in much the same way that the 1992 (and 2010) U.S. Horizontal Merger Guidelines define them. Moreover, although the EC Guidelines state that the EC will use postmerger-HHI and merger-generated increases-in-HHI figures only as "initial indicators," this statement seems to reflect not a general skepticism about the definability of markets (145) and the usefulness of data on market-aggregated parameters but a recognition that in some cases current market shares will not be good indicators of the market shares that the relevant firms would have in the future absent the merger. The EC's approaches to legal analysis are highly market-oriented: thus, (1) the EC's horizontal-merger guidelines identify situations in which such mergers will not normally require further analysis or are unlikely to cause concern by the postmerger HHI figures and merger-generated increase-in-HHI figures associated with the merger in question (146) (though the relevant figures the EC cites are more lenient than those in the 1992 U.S. Guidelines--they resemble more closely the actual 1992 to 2010 practice of the U.S. DOJ and FTC), (2) the EC's analysis of a firm's dominance (which the EC thinks is salient not just because Article 102 places special legal obligations on dominant firms but also because it believes [unjustifiably] that a firm's dominance has a great deal of bearing on the competitive impact of and motivation for its conduct) infers firm-dominance almost exclusively from firm market-share, and relatedly (3) the EC's approach to analyzing the legality of various contractual/sales-policy surrogates for vertical integration places heavy emphasis on the market share of the perpetrating seller. (147) Both Prof. Podszun's article (148) and Prof. Zimmer's article (149) support the claim that the EC's and the E.U. courts' approach to antitrust-law analysis is overwhelmingly market-oriented. However, there is some good news (from my perspective): as Prof. Zimmer also reports, "[t]he Commission has in its recent practice based a number of decisions on the analysis of how close the competition between merging parties is" as opposed to on market-aggregated-parameter estimates--i.e., as opposed to on estimates of the merger partners' market shares or on a relevant market's HHI-focused figures. (150) The other good news from my perspective is that both the DOJ/FTC's post-1992 approach and their 2010 Horizontal Merger Guidelines have largely abandoned the market-oriented approach. Thus, the merger simulations that the DOJ and FTC executed post-1992 and the inferences they drew from natural events post-1992 were not market-oriented. (151) And although the 2010 Guidelines continue to claim that the DOJ and FTC will use a market-oriented approach to predicting the competitive impact of horizontal mergers (one that uses an abstract definition of a relevant antitrust market that has for no discernible reason been slightly altered (152) [the 2010 Guidelines abandon the incorrect protocol for identifying the set of products that the abstract definition implies should be placed in a relevant market (153)]), the text of the 2010 Guidelines clearly reveals that the "agencies" do not intend to use a market-oriented approach to predicting the competitive impact of horizontal mergers. (154)

The second cluster of points I made in my 1979 lecture related to the unilateral effects of horizontal mergers. As Prof. Brennan states, at that time, the antitrust community largely ignored the possible unilateral effects of horizontal mergers--proceeded on the assumption that the main or perhaps the only argument against such mergers was that they facilitated collusion, that they had "coordinated effects." (155) I argued that the primary way that horizontal mergers lessen at least price competition is by generating unilateral effects. More specifically, I argued that, as an initial matter, (156) at least in individualized-pricing situations, if the merger would generate no relevant static marginal efficiencies, the unilateral price-effects of a horizontal merger would equal the number of sales that the merger partners were respectively (privately) best-placed and second-placed to make times the average amount by which the second-placed merger partner was better-placed than was the third-placed supplier of the buyers in question plus the number of sales that the merger partners were uniquely equal-best-placed to make times the average amount by which in these cases both merger partners were better-placed than the third-placed suppliers of the buyers in question. The good news is that, as is manifest in the 1992 Guidelines, by 1992, the U.S. DOJ and FTC had come to recognize the importance of the unilateral effects of horizontal mergers on prices and, although their analysis of these effects did not contain some important bells and whistles, (157) it basically did reach the correct conclusions (which I had articulated and explained to the Division in 1979). (158) The EC took over the DOJ/ FTC's basically correct analysis of this issue in its 2004 Guidelines. (159) And the DOJ and FTC retained this basically-correct analysis (without remedying its deficiencies) in their 2010 Guidelines. (160)

Third, in my 1979 lecture to the Antitrust Division, I also (1) defined the concept of natural oligopolistic pricing, (2) explained that a firm will be able to obtain an oligopolistic margin naturally if the extra costs it must incur to lower an initial price that it offered that exceeds its highest nonoligopolistic price is lower than the profits it could have made by supplying a relevant buyer (or relevant buyers) at the reduced price it would have to charge to beat a rival's undercutting response-offer had it charged the lower price initially, (3) pointed out that, to the extent that horizontal mergers have unilateral effects that increase the gap between the highest-nonoligopolistic prices and marginal costs both of the merger partners and of the merged firm's rivals, they will tend to increase the frequency with which these businesses can and will obtain oligopolistic margins naturally (by increasing the profits they could have made initially by charging their highest non-oligopolistic prices and hence the likelihood that they would find it inherently profitable to beat any underbid a rival made in response to their initially charging a supra-highest-nonoligopolistic price), and (4) argued that any tendency of a horizontal merger to increase natural oligopolistic margins will count against its Clayton Act legality because it will be associated with losses to Clayton-Act-relevant buyers even though natural oligopolistic pricing does not violate the Sherman Act since its practice does not involve the making of any anticompetitive offers or threats. The U.S. DOJ and FTC did not recognize natural oligopolistic conduct in their 1992 Guidelines, and although the 2010 Guidelines do contain a statement that may be referring to what I call natural oligopolistic conduct--"coordinated interaction includes conduct not otherwise condemned by the antitrust laws" (161)--they do not analyze the possible impact of horizontal mergers on such conduct or that impact's legal relevance. (162) The EC has never adverted to natural oligopolistic pricing.

Fourth, my 1979 lecture provided a detailed analysis of (1) the determinants of the profitability of contrived oligopolistic pricing; (163) (2) the ways in which horizontal mergers would affect the profitability of contrived oligopolistic pricing to both the merged firm relative to the merger partners and to the rivals of the merged firm; (164) relatedly, (3) the reasons why horizontal mergers are far less likely than the DOJ, FTC, and EC believe to create a merged firm that obtains more contrived oligopolistic margins than the merger partners would have done (indeed, may tend to create merged firms that obtain a lower amount of contrived oligopolistic margins than the merger partners would have obtained), primarily because, by generating unilateral effects that raise the highest nonoligopolistic price (HNOP)-marginal cost (MC) gaps for the merged firm above their merger-partner counterparts, such mergers deter the merged firm's practice of contrived oligopolistic pricing both by increasing the amount of safe profits it must put at risk to engage in the practice and by making it more vulnerable to defensive retaliation by undercutting underminers against which it has retaliated; (165) (4) the reasons why horizontal mergers may well increase the contrived oligopolistic margins that the merged firm's rivals obtain--primarily because such mergers reduce the number of such merged-firm rivals' potential undercutters by one and create a merged firm that is more vulnerable to retaliation than the merger partners would have been and is better-positioned to receive reciprocal benefits from a contriving rival than the merger partners would have been; (166) and (5) the relevance of any tendency of a horizontal merger to increase or decrease merged-firm or merged-firm-rival contrived oligopolistic pricing for its legality under the Clayton Act or the Sherman Act. (167)

To what extent have the DOJ and FTC and the EC reached the same conclusions on these issues that I reached? The answer to this question is disappointing. The 1992 Guidelines and the 1997 DOJ/FTC Revision of these Guidelines do a poor job of analyzing the determinants of the profitability of what I call contrived oligopolistic pricing and they call coordinated conduct (168)--inter alia, (1) ignore many important determinants, (2) make what is almost certainly the incorrect claim that, everything considered, product heterogeneity disfavors the profitability of contrived oligopolistic pricing, (3) almost totally ignore the impact that horizontal mergers will have on the profitability of such conduct to the merged firm relative to its profitability to the merger partners, and (4) do not even advert to the possibility that horizontal mergers may alter the profitability of contrived oligopolistic pricing to the merged firm's rivals--and the 2010 Guidelines' analysis of these issues is "not much better" than their treatment by the 1992 Guidelines and the 1997 Revision of those Guidelines. (169) Moreover, the EC Guidelines' discussion of coordinated conduct is no better than the U.S. Guidelines' treatment of these issues--it gets some things right and some things wrong and ignores many important determinants of both the profitability of contrived oligopolistic pricing and the impact of horizontal mergers on the profitability of that practice. (170)

Fifth, in my 1979 lecture, I also (1) discussed the relevance of a horizontal merger's impact on the intensity of QV-investment competition in and the equilibrium-QV-investment quantity in any arbitrarily-defined area of product-space to its legality under the Clayton Act, (171) (2) defined possible intermediate determinants of the intensity of QV investment competition in an ARDEPPS, (172) (3) distinguished three categories of QV-investment equilibria in any ARDEPPS, (173) (4) explained the different ways in the respective QV-investment-equilibrium situations that the various possible intermediate determinants of the intensity of QV-investment competition interact to determine the intensity of QV-investment competition, (174) and (5) analyzed the determinants of the impact of any horizontal merger on the intensity of QV-investment competition in the ARDEPPS in which it took place. (175)

To what extent have the U.S. DOJ and FTC and the EC replicated these analyses and/or reached conclusions on these issues that are similar to mine? The answer to this question is: virtually not at all. Thus, the 1992 Guidelines pay almost no attention to what I call quality-or-variety-increasing-investment (QV-investment) competition--(1) largely ignore the ability of incumbents to increase the amount of QV investment they make in an area of product-space in which they are operating, (2) misanalyze the conditions under which potential competition will be effective, (3) misanalyze the consequences of merger-generated QV-investment expansions or entries (think solely in terms of price-effects [ignore effects on quality and variety] and exaggerate the significance of the price-effects they predict), (4) manifest no awareness of the intermediate determinants of the intensity of QV-investment competition in any area of product-space or the different ways in which in different situations they interact to determine the intensity of QV-investment competition in an area of product-space, and relatedly (5) have almost nothing to say about the determinants of a horizontal merger's impact on QV-investment competition. (176) Moreover, although the 2010 U.S. Guidelines do recognize that a horizontal merger can confer equivalent-dollar gains on Clayton-Act-relevant buyers even if it does not lower prices by increasing the quality and variety of the products they can buy (177) and do contain some insights into the determinants of the possible impact of horizontal mergers on QV-investment competition that the 1992 Guidelines ignored, (178) the 2010 Guidelines' treatment of QV-investment competition shares most of the deficiencies of the 1992 Guidelines' treatment of this phenomenon. (179) Unfortunately, the EC's treatment of QV-investment competition is not any better: thus, although the EC 2004 Guidelines do recognize the importance of quality-and-variety effects, they contain no real analysis of the determinants of a horizontal merger's impact on quality and variety (on equilibrium QV investment in the relevant area of product-space); repeat their U.S. counterparts' mistake of claiming that "likely, timely, and sufficient ... [entry in response to horizontal merger-generated increases in prices] deter or defeat any anticompetitive effects of ... [the horizontal merger]"; and manifest the Commission's continuing subscription to a variant of limit-price theory under which "when entry barriers are low, the merging parties are more likely to be constrained [when setting prices] by entry" (180)--a theory that, as Markovits I and Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law, Vol. II: Economics-Based Legal Analyses of Mergers, Vertical Practices, and Joint Ventures (hereinafter Markovits II) explain, (181) is theoretically invalid and unsupported by any empirical evidence.

Sixth, in my 1979 lecture, I also discussed in some detail my 1978 article's analyses of (1) the determinants of the contribution that any known-production-process-usage-related organizational economic efficiencies a horizontal merger generated would confer on Clayton-Act-relevant buyers (182) and (2) the determinants of the amounts of Sherman-Act-licit profits and Clayton-Act-relevant buyer gains that any horizontal-merger-generated QV-investment-related organizational economic efficiencies would yield. Markovits II (1) expands on my 1978 article's analysis (183) of the detenninants of the impact that horizontal-merger-generated QV-investment-related organizational economic efficiencies would have on Clayton-Act-relevant buyers'84 and (2) analyzes the detenninants of the contribution that any such "dynamic" organizational economic efficiencies would have on the merger partners' Sherman-Act-licit profits. (185) (I acknowledge that neither my 1978 article nor my 1979 lecture to the Antitrust Division, nor Markovits I or II, nor Markovits Summary addresses the determinants of the contribution that any horizontal-merger-generated production-process-research-related organizational economic efficiencies would make to the merger partners' Sherman-Act-licit profits or the determinants of the impact that any such efficiencies would have on Clayton-Act-relevant buyers. (186))

The DOJ, the FTC, and the EC have devoted virtually no attention to these issues. Thus, although the 1992 Guidelines state that horizontal-merger-generated efficiencies favor the Clayton Act legality of the merger to the extent that they "result in lower prices to consumers" (187) and the 1997 Revision of the 1992 Guidelines recognize that such efficiencies will also favor the Clayton Act legality of any horizontal merger that generates them to the extent that they lead to the introduction of "new or improved products" (188) (in my terms, increase variety or quality), neither the 1992 Guidelines nor their 1997 Revision distinguishes among the three categories of organizational economic efficiencies a horizontal merger can generate or analyzes the determinants of the magnitudes of the legally-relevant effects that any of these categories of organizational economic efficiencies can generate. (189) Unfortunately, the 2010 U.S. Guidelines make no significant improvement on the 1997-revised 1992 Guidelines' treatment of efficiencies. (190) With two minor exceptions, the 2004 EC Guidelines have all the deficiencies of the U.S. Guidelines: the exceptions are that the EC 2004 Guidelines do recognize that what I call static marginal efficiencies (efficiencies associated with reductions in marginal costs or product-improvements that are not fully offset by increases in marginal costs) benefit consumers more than efficiencies that are associated with fixed-cost reductions and that the extent to which static marginal efficiencies benefit Clayton-Act-relevant buyers increases with the "competitive pressure" faced by the merged firm (a crude step in the right direction). (191)

Seventh and finally, my 1979 lecture (1) articulated the difference between the Sherman Act test of illegality and the Clayton Act test of illegality, (2) explained why horizontal mergers could violate the Clayton Act but not the Sherman Act or vice versa, and (3) argued that it was important for the DOJ and the FTC to consider the legality of the horizontal mergers they analyzed under the Sherman Act as well as under the Clayton Act not only because some such mergers might violate the Sherman Act even though they did not violate the Clayton Act (say, because the merger partners critically overestimated [1] the frequency with which they were either best-placed and second-placed or uniquely equal-best-placed and/or [2] the second-placed merger partner's advantage over the third-placed suppliers of buyers the merger partners were respectively best-placed and second-placed to supply and/or both merger partners' advantages over the third-placed suppliers of buyers the two merger partners were uniquely equal-best-placed to supply) but also because, when a merger violates both the Sherman Act and the Clayton Act, the penalties that can be imposed on the merger partners under the Sherman Act are greater than those that can be imposed on them under the Clayton Act.

To my knowledge, the DOJ and FTC continue to consider only the Clayton Act illegality of horizontal mergers. I should add that the EC makes a somewhat-analogous error--it analyzes the legality of horizontal mergers only under the EMCR, not under Article 101.

So, to use Prof. Brenan's expression, how has my "conception" actually fared in the practice of the U.S. and E.U. antitrust authorities? Please forgive the chutzpah. In my judgment, from my perspective, a good deal of progress had been made since 1979, but much remains to be done.

Conclusion

As I am sure is apparent, this Comment on the contributions that other scholars have made to this symposium has not even attempted to do justice to them. Instead, it uses questions they raise, analyses they execute, and observations they contain as springboards for making points about economics and the interpretation and application of antitrust law that 1 think deserve elucidation or emphasis. I hope that the authors and you, the readers, conclude that, whatever its motivation, this act of self-indulgence is useful. (192)

DOI: 10.1177/0003603X15625138

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

(1.) Richard S. Markovits, Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law: A Summary (hereinafter Markovits Summary), Antitrust Bull. (2016). This Comment will also reference the two volumes of my study of Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law, Vol. I: Basic Concepts and Economics-Based Legal Analyses of Oligopolistic and Predatory Conduct (hereinafter Markovits I) and Vol. 11: Economics-Based Legal Analyses of Mergers, Vertical Practices, and Joint Ventures (hereinafter Markovits 11).

(2.) See Markovits I at 104-108 and Markovits II at 175-176.

(3.) See Pinar Akman, The Tests of Legality Under Articles 101 and 102 TFEU, Antitrust Bull. (2016), citing Pinar Akman, The Concept of Abuse in EU Competition Law: Law and Economics Approaches 101-102 (2012).

(4.) See Roger Van den Bergh, Vertical Restraints: The European Part of the Policy Failure, Antitrust Bull. (2016) in the paragraph following the paragraph in which footnote-number 3 appears.

(5.) See Daniel Zimmer, The Emancipation of Antitrust from Market-Share-Based Approaches, Antitrust Bull. (2016) at the text in which footnote-number 6 appears.

(6.) Treaty Establishing the European Economic Community (Treaty of Rome), 298 U.N.T.S. 11 (March 25, 1957).

(7.) See Van den Bergh, supra note 4 in the paragraphs in which footnote-number 40 and footnote-numbers 42-44 appear.

(8.) See Part III of Zimmer, supra note 5.

(9.) See Rupprecht Podszun, The Arbitrariness of Market Definition and an Evolutionary Concept of Markets, Antitrust Bull. (2016).

(10.) See Zimmer, supra note 5 at the text that precedes footnote-number 17 and Podszun, supra note 9 at in the paragraph in which footnote-numbers 20-25 appear.

(11.) I first established this conclusion in 1978 in Richard S. Markovits, Predicting the Competitive Impact of Horizontal Mergers in a Monopolistically Competitive World: A Non-Market-Oriented Proposal and Critique of the Market Definition-Market Share-Market Concentration Approach, 56 Tex. L. Rev. 587, 595-603 (1978). I developed the relevant arguments in more detail in 2002 in this journal. See Richard S. Markovits, On the Inevitable Arbitrariness of Market Definitions, 2002 Antitrust Bull. 571 (2002). These arguments are reprised in Markovits 1 at 165 (ch. 6) and used to explain the indefensibility of a large number of official and scholarly protocols for defining classical economic and antitrust markets in Markovits I at 183 (ch. 7). The arguments in question are summarized in my introductory essay in this issue. See Markovits Summary, starting at the text that contains footnote-number 19.

(12.) See Podszun, supra note 9, starting with the paragraph that follows the paragraph that contains n.33 through the end of his article, and Zimmer, supra note 5, starting with the paragraph that contains n. 100 through the paragraph that contains n. 101.

(13.) See Podszun, supra note 9 at the paragraph containing footnote-number 33.

(14.) Clayton Act, 38 Stat. 730 (1914) (codified as amended at 15 U.S.C. Sections 12-27). In particular, at least as it relates to U.S. law, I am not persuaded by the interpretive argument the text articulates for two reasons: (1) U.S. courts are obligated to give (constitutionally-) saving-constrictions of statutes that instruct them to do something incoherent, and U.S. courts often do give saving-constructions to language in statutes whose straightforward interpretation would render them unconstitutional, and (2) the language quoted in the text could be interpreted to indicate that covered conduct would violate Section 7 only if it imposed a significant equivalent-dollar loss on Clayton-Act-relevant buyers--i.e., to establish a de minimis qualification to the "lessening competition" test of illegality.

(15.) Treaty of Lisbon Amending the Treaty on European Union and the Treaty Establishing the European Community (hereinafter Treaty of Lisbon) at Article 102, OJ 6306 (December 13, 2007).

(16.) Council Regulation 139/2004 on the Control of Concentrations Between Undertakings (hereinafter EMCR) at Article 2, 3, OJ L24/1 (May 1, 2004).

(17.) Id. at Article 2, [paragraph] 1.

(18.) Council Regulations 330/2010 on the Application of Article 101(3) of the Treaty [of Lisbon] on the Functioning of the European Union to Categories of Vertical Arguments and Concerted Practices at Article 3, OJ L120/1 (April 23, 2010).

(19.) See Treaty of Lisbon at Article 101(1).

(20.) See Markovits I at 165 and Markovits Summary at Part 3B.

(21.) See Markovits I at 250-264 and Markovits Summary at Part 3B.

(22.) See Markovits I at 250-264 and Markovits Summary at Part 3B.

(23.) See Markovits 1 at 275-299 and Markovits Summary at Part 3B.

(24.) See Markovits I at 265-267.

(25.) Id. at 267-274.

(26.) See, e.g., id. at 78-80 and 249-250 and Markovits II at 389-393.

(27.) See Markovits I at 101-102 and 129.

(28.) See id. at 140 and Markovits II at 46.

(29.) See Markovits II at 48.

(30.) See, e.g., id. at 438-439, 442, 456, 458-459, and 473.

(31.) See Podszun, supra note 9 in the paragraph that contains footnote-number 5.

(32.) See Zimmer, supra note 5 in the paragraphs that contain footnote-numbers 57-64.

(33.) Department of Justice and Federal Trade Commission, 1992 Horizontal Merger Guidelines, 4 Trade Reg. Rep. (CCH) Section 13,104 (1992), 57 Fed. Reg. 41, 532.

(34.) See Markovits II at 125-126.

(35.) See Van den Bergh, supra note 4 in Part IB.

(36.) Id. in the paragraph that contains footnote-numbers 31-33.

(37.) See Markovits II at 243-351 and 476-483. See also Markovits Summary at the text that follows the paragraph that contains footnote-number 71 through the paragraph that contains footnote-number 77.

(38.) Id. at 333.

(39.) Id. at 343-344.

(40.) Id. at 279-282.

(41.) Id. at 305-308.

(42.) See Markovits Summary, starting at the paragraph that follows the paragraph that contains n.86 through the paragraph that contains n.96. See also Markovits I at 642-645 and Markovits II at 642-645 (the fact that the page-numbers of the pages in Vols. I and II that discuss this issue are the same is purely coincidental).

(43.) See Markovits II at 378 and Markovits Summary at the paragraph that contains n.71.

(44.) Markovits II at 377-378.

(45.) See, e.g., id. at 389-393.

(46.) See Markovits I at 656, n.768.

(47.) Id. at 676-678.

(48.) See Markovits I at 83-86 and Markovits II at 665.

(49.) Id. at 391.

(50.) Markovits I at 676-678.

(51.) Markovits II at 396-397.

(52.) See Markovits I at 109-111.

(53.) See Markovits II at 415, 435, and 455-456.

(54.) Id. at 444-446 and 472.

(55.) Id. at 449-450 and Murkovits Summary at n.83.

(56.) Markovits II at 448-450.

(57.) Id. at 434-475.

(58.) See Akman, Tests of Legality, supra note 3 in the paragraph that contains footnote-number 38.

(59.) Id. in the paragraph that contains footnote-numbers 39-43.

(60.) Id. in the paragraph that contains footnote-numbers 44-49.

(61.) Id. at the text that contains footnote-numbers 41-42.

(62.) Id. at the text that contains footnote-numbers 52-53.

(63.) Id. in the paragraph that contains footnote-numbers 50-55.

(64.) See, e.g., Markovits II at 431.

(65.) See Van den Bergh, supra note 4 in the paragraph that contains footnote-numbers 25-27.

(66.) Id. in the first paragraph of Part IIB.

(67.) Id. in the last paragraph of Part II.

(68.) Id. in the paragraph that contains footnote-numbers 46-48.

(69.) Id.

(70.) Id. at the text to which footnote-number 50 is attached.

(71.) For a full account of this conceptual system, see Markovits I at 15-40. For a briefer account, see Markovits Summary at Part 3C.

(72.) For a full account of this conceptual system, see Markovits I at 40-68. For a briefer account, see Markovits Summary at Part 3D.

(73.) See Markovits 1 at 17-18, 22-23, and 343-345.

(74.) See id.

(75.) See id. at 531-535.

(76.) See id. at 582-591.

(77.) See id. at 605-609.

(78.) See id. at 18-22, 26-39, and 368-370.

(79.) See id.

(80.) See id. and id. at 531-535.

(81.) See id. at 352-367.

(82.) See id. at 349-351.

(83.) See id. at 503-517.

(84.) See id. at 582-591 (predatory QV investments) and 605-609 (predatory cost-reducing investments).

(85.) See id. at 367-387.

(86.) See id.

(87.) See id. at 531-543.

(88.) See id. at 596-601 (QV investments) and at 610 (cost-reducing investments).

(89.) See id. at 387-414 (critiques of tests for illegal oligopolistic pricing proposed by scholars), at 414-453 (critiques of tests for illegal oligopolistic pricing used by U.S. courts), at 453-460 (critiques of tests for illegal oligopolistic pricing used by the EC and by E.C./E.U. courts and other related positions these authorities have taken), at 591 -595 (critique of a scholarly proposal for determining the predatory character of any QV investment), and at 601-604 (critiques of the U.S. case-law on predatory QV investments). There is no E.C./E.U. case-law on and no EC pronouncement on predatory QV investments. No scholar or antitrust-law-enforcement authority in either the U.S. or the E.U. has even noted the possibility that cost-reducing investments could be predatory.

(90.) See Markovits II at 2-3, 22-37, and 73-77. See also Markovits Summary at Part 2C(1), at the two paragraphs that immediately follow the paragraph that contains footnote-number 48, at the paragraph that contains footnote-number 59, and at the paragraph that immediately follows the paragraph that contains footnote-number 59.

(91.) See Markovits II at 3-4 and 4-40 for merger partners and mergers and id. at 533-549 for joint venturers and joint ventures.

(92.) See Markovits 1 at 642; Markovits II at 264-274, 320-325, 344-346, 481-482, 485, 501, and 642-645; and Markovits Summary at the ten paragraphs that immediately follow the paragraph that contains footnote-numbers 84-86.

(93.) See Jeffrey L. Harrison, Comments on Richard Markovits' Claim That the Requirement of Pre or Post Market Power Is Unnecessary in Monopolization and Attempt to Monopolize Cases and a Proposed Second-Best Reconciliation of the Per Se and Conventional Approaches to Dangerous Probability, Antitrust Bull. (2016) at the paragraph that contains footnote- number 46.

(94.) See Timothy J. Brennan, Ahead of His Time: The Singular Contributions of Richard Markovits, Antitrust Bull. (2016) at the two paragraphs that immediately follow the paragraph that contains footnote-number 4 and at the paragraph that contains footnote-number 19. See also id. at the paragraph in which footnote-numbers 9-11 appear.

(95.) Id.

(96.) See Harrison, supra note 93 at the paragraph in which footnote-number 47 appears.

(97.) See Brennan, supra note 94 at the paragraph in which footnote-numbers 5-6 appear.

(98.) See Markovits I at 75-76 and Markovits Summary at the text that contains footnote-number 4.

(99.) See, e.g., Markovits I at 76.

(100.) See Harrison, supra note 93 at its first paragraph. 1 hasten to add that Prof. Harrison does not indicate whether he thinks this position was correct as a matter of law when it was first announced or whether it has been validated by its longevity. For his purposes, it suffices that the doctrine is what it is.

(101.) See Brennan, supra note 94 at the paragraph in which footnote-number 45 appears. I should add that Prof. Brennan does not think that, as a matter of policy, antitrust laws should be about character. See id.

(102.) See Akman, Tests of Legality, supra note 3 in the sentence to which footnote-number 16 is attached.

(103.) See Brennan, supra note 94 in the paragraph that immediately precedes the paragraph in which footnote-numbers 40-41 appear.

(104.) For a discussion of the positions that European scholars and the European Court of Justice have taken on "intent" in the antitrust context, see Akman, Tests of Legality, supra note 3 at the paragraphs in which footnote-numbers 6-19 and 65- 75 appear.

(105.) See Markovits 1 at 565, discussing inter alia Judge Easterbrook's comments on this issue in A.A. Poultry Farms, Inc. v. Rose Acre Farms, Inc., 881 F.2d 1396, 1402 (7th Cir. 1989).

(106.) See Akman, Tests of Legality, supra note 3 at the paragraph in which footnote-numbers 65-75 appear.

(107.) See Brennan, supra note 94 at his n.40.

(108.) See Akman, Tests of Legality, supra note 3 at the paragraph in which footnote-numbers 84-85 appear.

(109.) See id. at the paragraph in which footnote-numbers 6-9 appear.

(110.) See, e.g., id. at the sentence that contains footnote-number 9 and Pinar Akman, The Role of Intent in the EU Case Law on Abuse of Dominance, 39 European L. Rev. 316 (2014). 76-83 appears.

(111.) See id. in the text preceding footnote-number 10, citing Case 85/76 Hoffman-La Roche & Co AG v. EC Commission, ECR 461, [91] (1979).

(112.) Id. at the sentence that immediately precedes footnote-number 13.

(113.) Id. at the sentence that immediately precedes footnote-number 124.

(114.) See Markovits I at 7-14 and Markovits Summary at Part 2A.

(115.) For definitions of the various categories of organizational allocative efficiencies, the other categories of economic inefficiency, and the allocative transaction costs, risk and uncertainty costs, and financing-of-government-operations generated economic inefficiency the text references, see Markovits 1 at 155-157 and Markovits Summary at Part 2B.

(116.) See Markovits I at 157-163 and Markovits Summary at Part 2C.

(117.) See Akman, Tests of Legality, supra note 3 in the paragraph that immediately follows the paragraph that contains footnote-number 19.

(118.) See id. at the paragraph that contains footnote-numbers 23-26.

(119.) See Van den Bergh, supra note 4 at the paragraphs that contain respectively footnote-numbers 28-29 and footnote-number 46.

(120.) See Keith N. Hylton, Markovits on Defining Monopolization: A Comment, Antitrust Bull. (2016) at his last paragraph. Prof. Hylton accurately quotes my claim that "from any plausible conception of distributive justice, ... [monopolizing conduct] is unjust." See Hylton, supra note 120 at the text to which his footnote-number 2 is attached, quoting Markovits I at 70. He later delineates an example involving monopolization by "a firm that makes yachts for the extremely rich" that is "entirely owned by its employees" (see Hylton, supra note 120 at the second paragraph of the part of his Comment that is headed "The Distributive Justice Premise") to establish the conclusion that, in some cases, monopolizing conduct might promote distributive justice (presumably from a utilitarian or equal-resource/equal-opportunity egalitarian perspective). 1 agree that his conclusion is correct in the case he describes. Indeed, I suspect he would be correct from the above normative perspectives even if the firm he references had a more conventional set of shareholders. Nevertheless, I am confident that, even from the above distributive-justice perspectives, a universally-applicable rule prohibiting monopolizing conduct would promote distributive justice. I admit, however, that, although monopolizing conduct does disserve "distributive justice" not only from utilitarian and egalitarian perspectives but also from the perspective of evaluators who believe that the resources allocated to individuals should be determined by either the moral quality of their conduct or their allocative product (appropriately defined), the more important moral objection to monopolizing conduct is that it violates the moral rights of its victims (and calls for a corrective-justice response). That is what I was referencing when 1 wrote later in the three-page chapter on which Prof. Hylton focuses that monopolizing conduct is unjust not only "because it rewards its perpetrators for doing something that is economically inefficient and has no other redeeming consequences" but also "because it imposes losses on the customers of its perpetrator(s) and (when the monopolizing conduct in question is predatory) on the targets of its perpetrator(s) for no good reason at all." See Markovits 1 at 70. 1 should have used the expression "corrective-justice" in Chapter 3. I was trying to save space and avoid philosophical complications-admittedly-weak justifications. 1 have been clearer about this point in this Comment. See supra at the paragraph that immediately follows the paragraph that contains n.98: every unsuccessful attempt to violate the Sherman Act "is immoral, and it is a moral good to punish people or even to 'call them out' for engaging in immoral conduct" and "under the Sherman Act ..., a legal holding that unsuccessful attempts to engage in illegal behavior are illegal will yield a benefit sounding in corrective justice by enabling the victims of such unsuccessful attempts to obtain redress from their wrongdoing injurers." (Obviously, these statements will be equally applicable when the referenced attempts are successful.) I also want to make a point about an unrelated (correct) claim of Prof. Hylton--viz., that firms can engage in many types of conduct that are "difficult to put into" "the monopolization category." See Hylton, supra note 120 in the fourth paragraph under his heading "The Definition." I agree that it will often be difficult to determine whether conduct is "monopolizing" or "competition on the merits." Although I do not think that the following component of my operalization of the Sherman Act's test of illegality provides a quick or easy fix for this problem, I do think that it is instructive to recognize that conduct whose ex ante perpetrator-perceived profitability was critically affected by its or their belief that it would or might reduce the absolute attractiveness of the offers against which they will have to compete violates that test of illegality only if the conduct would be economically inefficient in an otherwise-Pareto-perfect economy (i.e., if its profitability would not otherwise have been critically deflated by the net effect of the economy's other Pareto imperfections).

(121.) See Markovits I at 123 for the relevant treaty-provision and at 123-125 for a discussion of its legally-correct interpretation.

(122.) See id. at 130-131 and Markovits II at 418-419 for a defensible operationalization of this concept that focuses on the share that buyer surplus constitutes of the sum of the buyer and seller surplus generated by the perpetrator's relevant sales. As previously noted, Prof. Akman's research casts doubts on the correctness as a matter of law of the conclusion that Article 102 prohibits exploitative abuses of a dominant position. See Pinar Akman, The Concept of Abuse in EU Competition Law: Law and Economics Approaches 101-102 (2012).

(123.) See Markovits I at 135-137. See also Prof. Akman's discussion of "competition on the merits" in Akman, Tests of Legality, supra note 3, at the part of her article headed "Types of Conduct and Competition on the Merits"--the text that starts with the paragraph that contains footnote-numbers 106-113 and ends with the paragraph that contains footnote-numbers 140-144. Prof. Akman references the possibility that antitrust policies (implicitly, in particular, laws that prohibit manufacturers from using contract clauses to impose vertical restraints on their independent distributors) might be adopted to increase distributor freedom (in my terms, to preserve distributor "liberty"). I have not indicated this possible good in the textual discussion because, as Prof. Akman recognizes, for three reasons, antitrust law cannot protect any such liberty interests, properly so-called: (1) independent distributors do not have "liberty interests" properly so-called in making the choices that the contractual clauses/sales policies in question prohibit/tend to deter them from making; (2) the restrained independent distributors (agreed to the contractual clauses in question)/(continued to patronize the manufacturers who had the relevant sales policies) in circumstances in which it could not be said that the distributors' wills had been overborne; and (3) in many if not most of the situations in question, the manufacturers would respond to laws prohibiting them from including the restraining clauses in their contracts or adopting the restraining sales policies by making other lawful moves (vertically integrating forward into distribution, charging lower franchise [lump-sum] fees and higher unit prices) that limit the options of the independent distributors or potential independent distributors at least as much as the prohibited contract clauses or sales policies would have done. For the basic point, see Akman, Tests of Legality, supra note 3 at the paragraph that contains footnote-numbers 50-55. For a full discussion of this issue, see Markovits I at 83-86.

(124.) I have not listed increasing competition as a separate goal because I consider it to be a proximate goal valued because its achievement will further the achievement of the first five goals in this list.

(125.) See Van den Bergh, supra note 4, inter alia at the final paragraph of his Introduction and the paragraphs that respectively contain footnote-numbers 41, 42-44, and 46-48.

(126.) See Podszun, supra note 9 at 5 in the paragraph that follows the paragraph that contains footnote-number 17.

(127.) See Zimmer, supra note 5 at the paragraphs that contain respectively footnote-numbers 4-5, 6, 68-69, 74-79, and 115.

(128.) See Akman, Tests of Legality, supra note 3, inter alia in the paragraphs that contain respectively footnote-numbers 1, 20-21, 36-38, 76-83, 86-91, 95-102, and 114-122.

(129.) See Brennan, supra note 94, inter alia at the two paragraphs that immediately follow the paragraphs that respectively contain footnote-numbers 3, 42-44, and 45.

(130.) See supra at the text to which footnote-number 120 is attached.

(131.) See Hylton, supra note 120 in the part of his Comment headed "The Distributive Justice Premise."

(132.) See Abraham L. Wickelgren, The Necessary Complexity of Predatory Pricing Analysis: A Comment on Richard S. Markovits's Treatment of Predatory Pricing in Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law, Antitrust Bull. (2016) at the paragraph that is the fifth paragraph after the paragraph that contains footnote-number 3. Although, at first thought, the fact that Wickelgren's piece is kind of a policy-piece (see below) makes his decision not to discuss the goals of antitrust policy somewhat surprising, the fact that he is analyzing the approach to predatory-pricing cases that best effectuates what he takes to be Congress' goals in passing the Sherman Act explains this feature of his article.

(133.) See Brennan, supra note 94 at the paragraph that immediately precedes the paragraph that contains footnote-number 45 and the paragraph that contains footnote-number 45.

(134.) See id. at the paragraph that contains footnote-number 3 and the five paragraphs that immediately follow the paragraph that contains footnote-number 3.

(135.) The two claims made in the sentence to which this footnote is attached ignore the possibilities that (1) the relevant statute or treaty prohibition may prohibit conduct whose prohibition violates a moral right of a member of or participant in the society to which it applies, (2) the government in question may have a moral and related constitutional obligation to secure the moral rights of the members of and participants in the society it governs (inter alia, to prevent violations of their moral rights by non-governmental actors as well as by the government itself), and (3) the individuals in question may have a moral right not only not to be harmed by choices motivated by specific anticompetitive intent but also to obtain redress from the wrongdoers that or who harmed them by making such choices, and the government in question may have a moral duty to give victims of moral-rights violations an appropriate opportunity to secure legal redress from their moral-rights-violating injurors. Any moral and constitutional duty that a government has to deter moral-rights violations and to provide those for whom it is responsible with an appropriate opportunity to obtain redress from wrongdoers who or that have violated their moral rights would constrain the government in relation to its attempting to secure non-moral-rights-related goals such as not inhibiting legitimate competition--i.e., would render immoral and (in any rights-based society of perfect moral integrity) unconstitutional decisions by government to adopt operational decision-rules that reduce the extent to which it deters conduct motivated by specific anticompetitive intent (such as predation) and the ability of victims of such conduct to obtain redress from those who harmed them by making choices motivated by specific anticompetitive intent (such as predators) unless the government could demonstrate that its choice increased the extent to which the moral-rights-related interests of those for whom it is responsible are secured. For a discussion of the philosophical basis of these claims and their possible relevance to the governments of the United States and (by implication) the European Union, see Richard S. Markovits, Matters of Principle: Legitimate Legal Argument and Constitutional Interpretation 12-89 (1998). 1 recognize that, with very limited exceptions, the positive law of the United States does not recognize any constitutional duty of its governments to secure the positive moral rights of those for whom they are responsible. Although (I suspect) the positive law of E.U. member-countries is more sympathetic to the existence of such positive duties of the state (at least as an aspirational matter), it is noteworthy in the current context that the Treaty of Lisbon does not provide victims of conduct that has as its object the restriction of competition or victims of exclusionary abuses of dominant positions with a legal right to obtain redress (corrective justice) from their wrongdoing injurors--indeed, does not even declare illegal predation (or exclusively-threat-based contrived oligopolistic conduct) by non-dominant firms. I hope that readers of this footnote do not conclude that it disqualifies its author.

(136.) See Hylton, supra note 120 in the last paragraph of the part of his Comment headed "The Definition."

(137.) See Akman, Tests of Legality, supra note 3 at the paragraph that contains footnote-numbers 84-85.

(138.) See Harrison, supra note 93 at the paragraph that precedes the paragraph that contains footnote-number 35 and in the paragraph that contains footnote-number 35.

(139.) See Brennan, supra note 94 at the paragraph that contains footnote-numbers 5-6.

(140.) See Department of Justice and Federal Trade Commission 1992 Horizontal Margin Guidelines, 4 Trade Reg. Rep. (CCH) Section 13,104 (1992), 57 Fed. Reg. 41, 532 and 1997 Revision of the 1992 Horizontal Merger Guidelines, http:// www.justice.gov/atr/public/guidlines/hmf.pdf; Markovits I at 190-210 (focusing on the 1992 Guidelines' abstract definition of the relevant antitrust market and protocol for identifying such markets); and Markovits 11 at 94-144, including a summary at 140-144 (focusing on all other aspects of the 1992 Guidelines).

(141.) See Department of Justice and Federal Trade Commission 2010 Florizontal Merger Guidelines (hereinafter 2010 U.S. Guidelines), http://www.justice.gov/atr/public/guidelines/hmg-2010.pdf (August 19, 2010) and Markovits II at 149-163.

(142.) See EC Guidelines on the Assessment of Horizontal Mergers, C31/5 OJ (2004), Council Regulation 139/2004 on the Control of Concentrations Between Undertakings (hereinafter EMCR for European Merger Control Regulation), OJ L24/1 (May 1, 2004), and Markovits II at 165-175.

(143.) Id. at 175-179.

(144.) Although the approach I recommend does contain a QV-investment-competition-focused component that makes reference to ARDEPPS-defined barriers to entry and expansion, it uses such concepts only heuristically: no conclusion depends on the oxymoronic accuracy of the way in which an ARDEPPS is defined.

(145.) See, in addition to the abstract market definition articulated in the 2004 EC Guidelines, the Commission Notice on the Definition of the Relevant Market for the Purposes of Community Competition Law, OJ C 372 (1997).

(146.) See Markovits II at 165-166.

(147.) See, e.g., id. at 445, 452, 456, 457, 458, 459, and 469.

(148.) See Podszun, supra note 9 at the text that contains footnote-numbers 2-15 and in the paragraph that contains footnote-numbers 30-32.

(149.) See Zimmer, supra note 5 at the paragraph that contains footnote-numbers 57-64.

(150.) See id. in the paragraphs that contain respectively footnote-numbers 67, 68-69, 70-79, 84, 85, and 86.

(151.) See Markovits 11 at 144-148.

(152.) See Markovits Summary at the paragraph that contains footnote-number 66.

(153.) See Markovits II at 149 and Markovits Summary at the paragraph that follows the paragraph that contains footnote-number 66.

(154.) See Markovits 11 at 150-151 and at n. 1050 on pages 150-151. See also Markovits Summary in the final paragraph of its Part 4C.

(155.) See Brennan, op. cit. supra note 94 at the paragraphs that contain respectively footnote-numbers 4-6, 7, and 8.

(156.) I wrote "as an initial matter" because the textual claim ignores the effect that any related increase in the prices the merged firm charges its customers over the prices the best-placed merger partner would have charged them will have on the highest non-oligopolistic and hence actual prices charged by the merged firm's rivals by raising the contextual marginal costs the merged firm would have to incur to match these rivals' premerger highest nonoligopolistic offers to their customers in cases in which a merger partner would have been second-placed to supply the buyers in question and any related feedback-effects the merger would have on this account on the merged firm's highest nonoligopolistic prices by raising these rivals' prices to their customers and hence the contextual marginal costs these merged-firm rivals would have to incur to match what would otherwise be the merged firm's highest nonoligopolistic offers to its customers and so on and so forth. For the definition of "contextual marginal costs," see Markovits Summary at the second paragraph of Part 3C(1).

(157.) For example, the 1992 Guidelines do not advert to the interactions described in n.152 supra, do not distinguish between the analysis of unilateral effects in individualized-pricing and across-the-board-pricing contexts, and do not recognize that in across-the-board-pricing contexts, it is tricky to define the competitive advantages and disadvantages of various potential suppliers of a particular buyer (see Markovits I at 26-27 and Markovits Summary at Part 3C(2)) and that horizontal mergers can affect the array of highest non-oligopolistic prices not only by affecting the relevant sellers' distributions of competitive advantages and disadvantages but also by affecting the order in which the relevant sellers announce their prices (see id. at 38-39).

(158.) I should say, however, that the diversion-ratio protocol that both the 1992 Guidelines and the 2006 DOJ/FTC Commentary on those Guidelines indicate the "agencies" will use to execute the relevant analysis is both "peculiarly circuitous" and misguided. See United States Department of Justice and Federal Trade Commission, Commentary on the Florizontal Merger Guidelines (2006) and Markovits II at 112-113 for a critique.

(159.) See id. at 167-168.

(160.) See 2010 U.S. Guidelines at [section][section] 4.2, 6.1 1 I, 6.1 1 3, and 6.2.

(161.) See id. at [section] 7 2.

(162.) See Markovits II at 158.

(163.) See Markovits 1 at 352-367, Markovits II at 7-9 and 14-15, and Markovits Summary at the text that contains footnote number 27.

(164.) See Markovits II at 9-10.

(165.) See id.

(166.) See id. at 11-12.

(167.) See id. at 2-4 (Sherman Act) and Markovits I at 97 and 98.

(168.) See id at 116-124.

(169.) See id at 156-157.

(170.) See id at 168-171.

(171.) See id at 16-17.

(172.) See Markovits I at 43-49.

(173.) See id at 49-68.

(174.) Id.

(175.) See Markovits II at 17-21 (when the merger generates no QV-investment-related [dynamic] efficiencies) and at 35-37 (where the impact of any dynamic efficiency a horizontal merger generates on Clayton-Act-relevant buyers is examined).

(176.) See id. at 129-134.

(177.) See 2010 U.S. Guidelines at [section] 10 [paragraph] 1 and Markovits II at 158-159.

(178.) See 2010 U.S. Guidelines at [section] 6.4 [paragraph] 3 and [section] 10 [paragraph] 10. See also Markovits II at 158-159.

(179.) See id. at 159.

(180.) See id 171.

(181.) See Markovits I at 517-519 and Markovits 11 at 221-232. See also Markovits Summary at the paragraph that contains footnote-number 50.

(182.) See Markovits II at 2 and 22-35. See also Markovits Summary at the paragraph that contains footnote-number 49.

(183.) See Richard S. Markovits, Predicting the Competitive impact of Horizontal Mergers in a Monopolistically Competitive World: A Non-Market Share-Market Concentration Approach, 56 Tex. L. Rev. 587 at 695-697 (1978).

(184.) See Markovits 11 at 35-37. See also Markovits Summary at the paragraph that contains footnote-number 50.

(185.) See Markovits II at 2-3. See also Markovits Summary at the paragraph that contains footnote-number 51.

(186.) The relevant analyses would be similar to but not identical to their QV-investment-efficiency-related counterparts.

(187.) See 1992 U.S. Guidelines at [section] 4 [paragraph] I and Markovits II at 135.

(188.) See Markovits II at 135.

(189.) See id. at 135-136.

(190.) See id. at 160-161.

(191.) See id. at 172-173.

(192.) It is always in an economist's interest to make an Adam-Smith-type point.

Richard S. Markovits *

* The University of Texas at Austin, Austin, TX, USA

Corresponding Author: Richard S. Markovits, The University of Texas at Austin, Austin, TX 78705, USA. Email: rmarkovits@law.utexas.edu
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Title Annotation:articles in this issue, p. 84, 105, 109, 121, 133, 155, 167, 186; Symposium: Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law
Author:Markovits, Richard S.
Publication:Antitrust Bulletin
Date:Mar 1, 2016
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