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Predatory Pricing

Predatory Pricing

Chapter:
(p.83) 5 Predatory Pricing
Source:
The Atlantic Divide in Antitrust
Author(s):
Daniel J. GiffordRobert T. Kudrle
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226176246.003.0005

This chapter explores developments in predatory pricing analysis in the United States and the European Union where the two jurisdictions have taken different approaches. It identifies major contributions to predatory pricing analysis from Areeda-Turner, Baumol and Bolton. It deals with the appropriate places in predatory pricing analysis for various costs such as marginal, average, average variable, avoidable, incremental and opportunity costs, the significance of recoupment, and identifies places where the U.S. approach may be changing. It observes differences between the European Commission and the European courts. And it looks at the divergent approaches of the two jurisdictions to a price squeeze imposed by a vertically integrated producer supplying inputs to a competitor in a downstream market.

Keywords:   Phillip Areeda, Donald Turner, William Baumol, Patrick Bolton, incremental cost, opportunity cost, recoupment, squeeze

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