CONFERENCE CONCURRENCES " COMPETITION, MONOPOLY AND MARKET POWER", PARIS, DECEMBER 9TH, 2009

Competition, monopole and market power

The concept of market power lies at the heart of competition assessments. In practice, market shares are often used to measure market power. While market shares can provide useful information in this regard in certain circumstances, they feature important shortcomings in numerous contexts and may then give a biased representation of actual market power. This article reviews a number of limitations of market shares encountered in specific cases. It also sets out some analytical tools for competition assessments of market power going beyond market shares, including econometric demand analysis, bidding studies, customer surveys and merger simulation.

*This article is an automatic translation of the original article, provided here for your convenience. Read the original article. Market power, monopoly and concentrations: What assessment beyond market shares? Fabien Curto Millet Economist 1. The notion of market power is a fundamental element of competitive analysis. It is present more or less explicitly in cases of abuse of a dominant position, in the assessment of concentrations, and even underlying in the context of cartels when it comes to their impact on the market. In the practice of competitive analysis, market power is usually approximated by market shares. Although market shares can provide useful indications of market power in some circumstances, they have important shortcomings in many contexts and can give a biased

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Fabien Curto Millet, Olivier D'Ormesson, Stanislas de Guigné, Competition, monopole and market power, February 2010, Concurrences N° 1-2010, Art. N° 30120, www.concurrences.com

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