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Journal of Competition Law and Economics Advance Access originally published online on June 21, 2008
Journal of Competition Law and Economics 2008 4(3):893-913; doi:10.1093/joclec/nhn020
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© The Authors (2008). Published by Oxford University Press. All rights reserved. For Permissions, please email: journals.permissions@oxfordjournals.org

SEQUENTIAL VERSUS SIMULTANEOUS MARKET DELINEATION: THE RELEVANT ANTITRUST MARKET FOR SALMON

Niels Haldrup *, Peter Møllgaard ** and Claus Kastberg Nielsen ***

Correspondence: E-mail: nhaldrup{at}creates.au.dk

Delineation of the relevant market constitutes a pivotal part of most antitrust cases. The standard analysis utilizes a sequential approach. First, the product market is delineated; then the geographical market is defined. Demand and supply substitution in both the product dimension and the geographical dimension will normally be stronger than substitution in either dimension. By ignoring this, one might decide first to define products narrowly and then define the geographical extent narrowly, ignoring the possibility of a diagonal substitution. These reflections are important in the empirical delineation of product and geographical markets. Using a unique dataset for prices of Norwegian and Scottish salmon, we propose a methodology that allows for simultaneous market delineation. We then show that market delineation may depend on the choice of method: a simultaneous method reverses the conclusions of a sequential approach as regards the delineation of the market for Atlantic salmon in Europe.

* Professor, Department of Economics, University of Aarhus.

** Professor, Department of Economics, Copenhagen Business School. E-mail: hpm.eco{at}cbs.dk

*** CEO, Copenhagen Economics. E-mail: ck{at}copenhageneconomics.com. We thank Tobias Købke of Copenhagen Economics for excellent research assistance and the Centre for Industrial Economics for financial support.


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