Input Market Definition under Department of Justice Merger Guidelines
Document Type
Article
Journal/Book Title/Conference
Review of Industrial Organization
Volume
4
Publication Date
1989
First Page
99
Last Page
114
Abstract
This paper applies the Justice Department's Merger Guidelines to define a relevant antitrust market for an input. An expression for the elasticity of the residual demand facing a monopoly supplier of a factor of production is derived. It is shown that proper input market definition depends on the elasticity of residual demand confronting the downstream input users, on the supply elasticity in the downstream market (which, in turn, depends on the rate of capital depreciation there), on the cost of the input as a percentage of downstream sales, and on the extent to which the monopolist is integrated downstream.
Recommended Citation
Input Market Definition under Department of Justice Merger Guidelines” (with Richard S. Higgins), Review of Industrial Organization 4 (Fall 1989), pp. 99–114.
