IDEAS home Printed from https://ideas.repec.org/a/bal/journl/2256-07422018419.html
   My bibliography  Save this article

The Relevant Temporal Market Definition In Antitrust Analysis

Author

Listed:
  • Anzhelika Gerasymenko

    (Department of Economics and Competition Policy, Kyiv National University of Trade and Economics, Ukraine)

  • Svitlana Afendikova

    (Department of Economics and Competition Policy, Kyiv National University of Trade and Economics, Ukraine)

Abstract

The purpose of the paper is to compare various theoretical approaches to the relevant temporal market definition, collecting the arguments for their implementation under the different kinds of antitrust cases. It is vital for the markets with peak demand (transport, electricity, markets of intergenerational products) or discreet supply (agriculture). Methodology. The survey is based on the theoretical and graphical modelling of product space perception by consumers. It investigates changes of the latter under different marketing strategies of a seller. Statistical methods are used to analyse trends of demand and prices for iPhones' changes, as well as dynamics of electricity consumption. Results. The paper reveals two facing approaches to the definition of relevant temporal market: 1) the discrete one that provides a short-run analysis of products' substitutability and combines only those time periods that are characterized by a stable balance of demand and supply, as well as stable market equilibrium; 2) the coherent one that provides a long-run analysis of cyclical variation of the market. This cycling is based on the awareness of consumers and producers of intertemporal substitutability of products. The authors use the model of intertemporal competition to explain principles of these approaches and apply it to the iPhone market analysis. They conclude that the coherent approach must be applied to the temporal market definition for the products with elastic demand. Inelastic demand brings the necessity to apply the discrete approach to the temporal market definition. These conclusions cannot be applied to regulated markets. The system of government regulation is the main determinant of the temporal boundaries of such markets. Practical implications. The results of this research can be used by competition agencies in antitrust cases to define the relevant temporal market, where the violations of antitrust legislation can occur. The correct definition of the market is the first step of structural analysis under antitrust cases that determinates the correctness of its next steps and finally - accurate labelling of an antitrust violation. Value/originality. The paper grounds capability of both (discrete and coherent) approaches to the relevant temporal market definition, determines the factors that define what the approach must be chosen, as well as the exceptions from the rule.

Suggested Citation

  • Anzhelika Gerasymenko & Svitlana Afendikova, 2018. "The Relevant Temporal Market Definition In Antitrust Analysis," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 4(1).
    • Handle: RePEc:bal:journl:2256-0742:2018:4:1:9
    DOI: 10.30525/2256-0742/2018-4-1-68-76
    as

    Download full text from publisher

    File URL: http://www.baltijapublishing.lv/index.php/issue/article/view/333/pdf
    Download Restriction: no
    File URL: http://www.baltijapublishing.lv/index.php/issue/article/view/333
    Download Restriction: no
    File URL: https://libkey.io/10.30525/2256-0742/2018-4-1-68-76?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, December.
    2. Calixto Salomão Filho, 2011. "A Legal Theory of Economic Power," Books, Edward Elgar Publishing, number 14360.
    3. Russo, Francesco & Stasi, Maria Luisa, 2016. "Defining the relevant market in the sharing economy," Internet Policy Review: Journal on Internet Regulation, Alexander von Humboldt Institute for Internet and Society (HIIG), Berlin, vol. 5(2), pages 1-13.
    4. Harikesh Nair, 2007. "Intertemporal price discrimination with forward-looking consumers: Application to the US market for console video-games," Quantitative Marketing and Economics (QME), Springer, vol. 5(3), pages 239-292, September.
    5. Thomaz Teodorovicz & Tainá Leandro & Luiz Alberto Esteves, 2016. "The Evolution Of A Methodology For Relevant Market Definition: An Analysis Of Cade'S Jurisprudence On Private Higher Educational Markets," Anais do XLII Encontro Nacional de Economia [Proceedings of the 42nd Brazilian Economics Meeting] 137, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Larysa Lebedeva & Oleksandra Moskalenko, 2021. "Impact Of The Covid-19 Pandemic On The Industrial Sector: Implications For Economic Policy," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 7(5).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vincent Mak & Amnon Rapoport & Eyran J. Gisches & Jiaojie Han, 2014. "Purchasing Scarce Products Under Dynamic Pricing: An Experimental Investigation," Manufacturing & Service Operations Management, INFORMS, vol. 16(3), pages 425-438, July.
    2. Vincent Mak & Amnon Rapoport & Eyran J. Gisches, 2018. "Dynamic Pricing Decisions and Seller-Buyer Interactions under Capacity Constraints," Games, MDPI, vol. 9(1), pages 1-23, February.
    3. Mohammed Al-Hitmi & Salman Ahmad & Atif Iqbal & Sanjeevikumar Padmanaban & Imtiaz Ashraf, 2018. "Selective Harmonic Elimination in a Wide Modulation Range Using Modified Newton–Raphson and Pattern Generation Methods for a Multilevel Inverter," Energies, MDPI, vol. 11(2), pages 1-16, February.
    4. Robin S. Lee, 2013. "Vertical Integration and Exclusivity in Platform and Two-Sided Markets," American Economic Review, American Economic Association, vol. 103(7), pages 2960-3000, December.
    5. Alderighi, Marco & Gaggero, Alberto A. & Piga, Claudio A., 2022. "Hidden prices with fixed inventory: Evidence from the airline industry," Transportation Research Part B: Methodological, Elsevier, vol. 157(C), pages 42-61.
    6. Warut Khern-am-nuai & Karthik Kannan & Hossein Ghasemkhani, 2018. "Extrinsic versus Intrinsic Rewards for Contributing Reviews in an Online Platform," Information Systems Research, INFORMS, vol. 29(4), pages 871-892, December.
    7. Xing Li & Megan MacGarvie & Petra Moser, 2014. "Dead Poets’ Property - How Does Copyright Influence Price," Discussion Papers 14-001, Stanford Institute for Economic Policy Research.
    8. Oscar Gutiérrez & Francisco Ruiz-Aliseda, 2011. "Real options with unknown-date events," Annals of Finance, Springer, vol. 7(2), pages 171-198, May.
    9. E. Villemeur & Helmuth Cremer & Bernard Roy & Joëlle Toledano, 2007. "Worksharing, access and bypass: the structure of prices in the postal sector," Journal of Regulatory Economics, Springer, vol. 32(1), pages 67-85, August.
    10. Jianqiang Zhang & Weijun Zhong & Shue Mei, 2012. "Competitive effects of informative advertising in distribution channels," Marketing Letters, Springer, vol. 23(3), pages 561-584, September.
    11. Donna, Javier D. & Pereira, Pedro & Trindade, Andre & Yoshida, Renan C., 2020. "Direct-to-Consumer Sales by Manufacturers and Bargaining," MPRA Paper 105773, University Library of Munich, Germany.
    12. Francisco B. Galarza & Gabriella Wong, 2017. "The Impact of Price Information on Consumer Behavior: An Experiment," Working Papers 106, Peruvian Economic Association.
    13. Kaplow, Louis & Shapiro, Carl, 2007. "Antitrust," Handbook of Law and Economics, in: A. Mitchell Polinsky & Steven Shavell (ed.), Handbook of Law and Economics, edition 1, volume 2, chapter 15, pages 1073-1225, Elsevier.
    14. Kessing, Sebastian G. & Konrad, Kai A. & Kotsogiannis, Christos, 2006. "Federal tax autonomy and the limits of cooperation," Journal of Urban Economics, Elsevier, vol. 59(2), pages 317-329, March.
    15. Etienne Billette de Villemeur & Kevin Guittet, 2004. "Optimal structure of air transport services when environnemental costs are taken into account," Post-Print hal-01022242, HAL.
    16. Aurora García‐Gallego & Nikolaos Georgantzís, 2009. "Market Effects of Changes in Consumers' Social Responsibility," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(1), pages 235-262, March.
    17. Simon P. Anderson & Régis Renault, 2011. "Price Discrimination," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 22, Edward Elgar Publishing.
    18. Leonard J. Mirman & Egas M. Salgueiro & Marc Santugini, 2013. "Integrating Real and Financial Decisions of the Firm," Cahiers de recherche 1333, CIRPEE.
    19. McCarthy, Ian M., 2016. "Advertising intensity and welfare in an equilibrium search model," Economics Letters, Elsevier, vol. 141(C), pages 20-26.
    20. Kuosmanen, Natalia & Valmari, Nelli, 2023. "Renewal of Companies Through Product Switching," ETLA Working Papers 104, The Research Institute of the Finnish Economy.

    More about this item

    Keywords

    relevant market; temporal market; intertemporal competition; peak and off peak services; intergenerational products;
    All these keywords.

    JEL classification:

    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
    • L49 - Industrial Organization - - Antitrust Issues and Policies - - - Other
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bal:journl:2256-0742:2018:4:1:9. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anita Jankovska (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.