Quantitative Techniques for Competition and Antitrust Analysis 8 docx

... expand production keeping output of each good in proportion. Source: Authors’rendition of a multiproduct cost function provided by Evans and Heckman (1 984 a,b) and Bailey and Friedlander (1 982 ). Economies ... result from a brand’s image. Suppose we face a market with two differentiated goods and the following linear demand system: Demand for good 1: q 1 D a 1  b 11 p 1 C b 12 p...

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... found in Fisher (1 980 , 1 986 ) and Finkelstein and Levenbach (1 983 ). For more general econometrics texts, see, for example, Greene (2007) and Wooldridge (2007). And for an advanced and more technical ... (0.0 18) — log.P Molson / 0.372 0 .80 4 0. 183 0.130 — (0.231) (0.031) (0.022) (0.012) — log.P Labatts / 0.243 0. 183 0. 588 0.0 28 — (0.034) (0.022) (0.044) (0.019) —...

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... price and quantity data alone it is impossible to empirically quantify the effect of an increase in prices on the quantity demanded and therefore to extract information such as the demand elasticity. A ... in matrix form and stack the sets of observations in their groups and note that the resulting matrices X g and X h will satisfy X 0 g X h D 0 for g ¤ h because d ig d ih D 0 (se...

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... 1 D 0.91 0 .85 0 .86 1 E 0.94 0.97 0.95 0.92 1 F 0.93 0.99 0.96 0 .88 0.99 1 G 0.11 0.05 0.01 0.33 0.02 0.01 1 H 0.57 0.55 0.25 0.16 0.24 0.27 0.17 1 I 0.77 0.75 0 .81 0 .86 0 .86 0.79 0.33 ... attractive 16 Engle and Granger (1 987 ) studied a single “co-integrating” relationship and showed that applying OLS to a regression of the form Y t D ˛X t C " t , where Y and X ar...

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... information about demand and in particular the own-price elastic- 40 This section draws on Harris and Simons (1 989 ) and also the working papers by O’Brien and Wickelgren (2003) and by Katz and ... demand curve. First, following Landes and Posner (1 981 ) and Scheffman and Spiller (1 987 ) consider the dominant-firm model. In that model, the dominant firm faced a mar- ket dem...

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... to allow for firm heterogeneity and Mazzeo (2002) and Seim (2006) extended the analysis and estimation of entrygames to allow for product differentiation. Davis (2006c) allowed for some forms of ... 281 43 28 15.3 10.0 2 Eastern 257 33 36 12 .8 14.0 3 United 231 36 10 15.6 4.3 4 American 207 22 12 10.6 5 .8 5 USAir 201 20 17 10.0 5 .8 6 TWA 174 22 23 12.6 13.2 7 Braniff 112 1...

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... .4; 2/ .5; 1/ 6 (Cartel) 1 28. 88 63.39 105 139 188 .54 270 .8 2 28. 88 63.39 105 77.6 48. 99 3 28. 88 63.39 4 28. 88 5 28. 88 6 28. 88 Industry profits 173 190 210 217 2 38 270 .8 8.3.2.4 Inferring Marginal ... (Cartel) 1 4 .8 5.3 5.9 6.62 7 .87 10.5 2 4 .8 5.3 5.9 6.62 7 .87 10.5 3 4 .8 5.3 5.9 6.62 7 .87 10.5 4 4 .8 5.3 5.9 6.62 7 .87 10.5 5 4 .8 5.3 5.9 5.77 7 .87 10.5 6 4 .8...

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... alternative functional form. For example, Berry et al. (1995) believe that the demand for a type of car will depend on a consumer’s level of income and work with the natural logarithm formulation, v j .y ... p k D  jk  w k ˇ j w j and therefore we can see that the own- and cross-price elasticities of demand depend on both the model parameters and the expenditure shares Á jk D 8...

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... 519 10.2.1 Informal and Semiformal Analysis of Incentives Informal quantitative analysis can sometimes be insightful for evaluating the incen- tive for foreclosure. An example of such an analysis ... scale and scope in production or distribution that allows the firm to 18 See, in particular, the foreclosure models discussed by Salop and Scheffman (1 983 ), Comanor and Fre...

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... small. For Lara, Adrian, and Tristan For Sara This page intentionally left blank Quantitative Techniques for Competition and Antitrust Analysis 8 1. The Determinants of Market Outcomes Demand at ... since understanding these key elements of economic analysis is crucial for an appropriate use of quantitative techniques. 1.1 Demand Functions and Demand Elasticiti...

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