Contents
List of Figures page
List of Tables
Preface
Acknowledgements
List of Abbreviations

1.Competition Policy: History, Objectives, and the Law
1.1 lntroduction
1.2 Brief History of Competition Policy
1.2.1 Anti-Trust Law in the United States
1.2.2 Competition Laws in the European Union
1.3 Objectives of Competition Policy and Other Public Policies
1.3.1 Objectives of Competition Policy
1.3.2 Other Public Policy Factors Affecting Competition
1.3.3 Competition Policy: A Definition
1.4 The Main Features of European Competition Law
1.4.1 Article 81: Horizontal and Vertical Agreements
1.4.2 Article 82: Abuse of a Dominant Position
1.4.3 Mergers
1.5 Exercises
2 Market Power and Welfare: Introduction
2.1 Overview of the Chapter
2.2 Aliocative Efficiency
2.2.1 Market Power: A Definition
2.2.2 The Allocative Inefficiency of a Monopoly
2.2.3 Rent-Seeking Activities
2.3 Productive Efficiency
2.3.1 Additional Welfare Loss from Productive Inefficiency
2.3.2 Why Is a Monopolist Less Efflcient?
2.3.3 Number of Firms and Welfare
2.3.4 Conclusions
2.3.5 Competition and Productive Efficiency
2.4 Dynamic Efflciency
2.4.1 The Lower incentives to Monopolist Innovation
2.4.2 Incentives to Invest in R&D
2.4.3 Modeis of Competition and Innovation*
2.5 Public Policies and Incentives to Innovate
2.5.1 Ex Ante v. Ex Post: Property Rights Protection
2.5.2 Essential Facilities
2.5.3 Price Controis and Structural Remedies
2.5.4 Interna] v. Externai Growth
2.6 Monopoly: Will the Market Fix it Ali?
2.6.1 Durabie Good Monopolist
2.6.2 Contestable Markets
2.6.3 Monopoly and Free Entry
2.7 Summary and Policy Conclusions
2.8 Exercises
2.8.1 Solutions to Exercises
3 Market Definition and the Assessment of Market: Power
3.1 Introduction
3.2 Market Definition
3.2.1 Product Market Definition
3.2.2 Geographic Market Definition
3.3 The Assessment of Market Power
3.3.1 Traditional Approach: (Indirect) Assessment of Market Power
3.3.2 Econometric Techniques: (Direct) Assessment of Market Power
3.4 Exercises
3.4.1 Solutions to Exercises
4 Coilusion and Horizontal Agreements
4.1 Introduction
4.1.1 What is Coilusion?
4.2 Factors That Fadiitate Coliusion
4.2.1 Structurai Factors
4.2.2 Price Transparency and Exchange of Information
4.2.3 Pricing Rules and Contracts
4.2.4 Analysis ofCollusion: Conclusions
4.2.5 Factors That Faciiitate Collusion
4.3 Advanced Material
4.3.1 Credibility of Punishment and Optimal Penal Codes
4.3.2 Cartels and Renegotiation
4.3.3 The Green - Porter (1984) Model
4.3.4 Symmetry and Collusion
4.4 Practice: What Should Be Legal and What Ilegal?
4.4.1 Standards ofProof: Market Data v. Hard Evidence
4.4.2 Ex Ante Competition Policies against Coilusion
4.4.3 Ex Post Competition Policies against Coilusion
4.5 Joint-Ventures and Other Horizontal Agreements
4.5.1 Joint-Ventures
4.5.2 Research Joint-Ventures
4.5.3 Other Forms of Co-Operation Regarding Technology
4.5.4 Co-Operative R&D
4.6 A Case of Parallel Behaviour: Wood pulp
4.7 Exercises
4.7.1 Solutions to Exercises
5.Horizontal Mergers
5.1 Introduction
5.2 Unilateral Effects
5.2.1 Absent Efficiencies, a Merger Increases Market Power
5.2.2 Variables Which Affect Unilateral Market Power
5.2.3 Efficiency Gains
5.2.4 Modelling Unilateral Effects of Mergers
5.3 Pro-Coilusive Effects
5.3.1 Factors which Affect Coilusion (Reminder)
5.3.2 Efficiency Gains and Pro-Coilusive Effects
5.4 A More General Model
5.4.1 The Model
5.4.2 Unilateral Effects, without Efficiency Gains
5.4.3 Efficiency Gains from Mergers
5.4.4 Efficiency Offence: When the Merger Leads to the Exit of the Outsiders
5.4.5 Proofs
5.5 Merger Remedies
5.5.1 Divestitures
5.5.2 Behavioural Remedies
5.6 Merger Policy in the European Union
5.6.1 Dominance Test
5.6.2 The Treatment of Efficiency Gains
5.6.3 Conclusions
5.7 Case Studies
5.7.1 How to Proceed in Merger Cases
5.7.2 Nestlê Perrier
5.7.3 ABB/Daimler-Benz
5.8 Exercises
5.8.1 Solutions to Exercises
6 Vertical Restraints and Vertical Mergers
6.1 What are Vertical Restraints?
6.1.1 Plan ofthe Chapter
6.2 Intra-Brand Competition
6.2.1 Double Marginalisation
6.2.2 Horizontal Externality: Free-Riding in the Provision of Services
6.2.3 A More General Treatment
6.2.4 Other Efficiency Reasons for Vertical Restraints and Vertical Mergers
6.2.5 Vertical Restraints, Vertical Mergers, and the Commitment Problem
6.2.6 Conclusions
6.3 Inter-Brand Competition
6.3.1 Strategic Effects of Vertical Restraints
6.3.2 Vertical Restraints as Collusive Devices
6.4 Anti-Competitive Effects: Leverage and Foreclosure
6.4.1 Anti-Competitive Effects: Exclusive Dealing
6.4.2 Exclusionary Effects of Vertical Mergers
6.5 Conclusions and Policy Implications
6.6 Cases
6.6.1 General Electric/Honeywell
6.6.2 Ice-Cream
6.7 Exercises
6.7.1 Solutions to Exercises
7 Predation, Monopolisation, and Other Abusive Practices
7.1 Introduction
7.2 Predatory Pricing
7.2.1 Predation: Search for a Theory
7.2.2 Recent Theories of Predatory Pricing
7.2.3 Models of Predatory Pricing
7.2.4 Practice: How to Deal with Predatory Pricing Allegations
7.3 Non-Price Monopolisation Practices
7.3.1 Strategic Investments
7.3.2 Bund]ing and Tying
7.3.3 Incompatibiity and Other Strategic Behaviour in Network Industries
7.3.4 Refusal to Supply and Exclusive Contracts (Reminder)
7.3.5 Raising Rivais' Costs
7.4 Price Discrimination
7.4.1 Welfare Effects of Price Discrimination
7.4.2 Price Discrimination
7.5 US v. Microsoft
7.5.1 A Short Description ofthe Case
7.5.2 Monopolisation
7.5.3 Attempted Monopolisation
7.5.4 Tying
7.5.5 Remedies
7.5.6 Conclusions
7.5.7 The District Court Judgment on Remedies
7.6 Exercises
7.6.1 Solutions to Exercises
8 A Toolldt: Game Theory and Imperfect Competition Modeis
8.1 Introduction
8.2 Monopoly
8.2.1 Single-Product Monopoly
8.2.2 Multi-Product Monopoly
8.3 An Introduction to Elementary Game Theory
8.3.1 Nash Equiibrium
8.3.2 Dynamic Games and Sub-Game Perfect Nash Equilibrium
8.4 Oligopoly 1: Market Competition in Static Games
8.4.1 Product Market Competition with Homogenous Goods
8.4.2 Product Market Competition with (Exogenously) Differentiated Goods
8.4.3 Repeated Product Market Interaction
8.5 Oligopoly II: Dynamic Games
8.5.1 Strategic Investments
8.6 Appendix

Bibliography
References to Cases and Legislation
Index