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2000-2001 Issue Number 6 Essay: R. Preston McAfee, Kenneth Hendricks, Joshua M. Fried, Michael A. Williams & Melanie Stallings Williams, Measuring Anticompetitive Effects of Mergers When Buyer Power is Concentrated, 79 TEXAS L. REV. 1621 (2001) Abstract: This essay addresses the recent increase in mergers and acquisitions and explores its implications for antitrust law. The Hircshmanm Hirfendal Index (HHI) has been the dominant mechanism employed by economists, judges, and the Department of Justice to measure market concentration. This article argues, however, that the HHI does not yield accurate proxies for the anticompetitive effects of integration in cases where both buyers and sellers have market power (as opposed to just sellers). This essay argues for an approach to measuring market power in vertically-related markets where concentration is present on both sides of the intermediate market and on the seller side of the downstream market. |