Abuse of Dominance by Firms Charging Excessive or Unfair Prices: An Assessment

Posted by Social Science Research Network

Abuse of Dominance by Firms Charging Excessive or Unfair Prices: An Assessment

Frederic Jenny (ESSEC Business School)

Abstract:     Competition authorities throughout the world are under pressure to use their enforcement powers to control excessive or unfair prices. In some countries, like the United States, competition authorities have clearly indicated that the antitrust laws were not meant to curb monopolistic prices. In other countries, like the European Union, excessive prices have occasionally been considered to be violations of the competition law. A vigorous debate among economists has taken place on what the definition of excessive prices could be and whether the control of excessive prices by competition authorities would in fact promote or discourage competition. This paper reviews this debate and considers alternative courses of action that competition authorities could consider in case of high prices.

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