Beyond Critical Loss: Properly Applying the Hypothetical Monopolist Test

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Gregory Werden, Feb 25, 2008

The hypothetical monopolist test (HMT) for market delineation holds that a group of products and associated area constitute a market only if a profit-maximizing monopolist over them would increase price significantly. This test was prominently articulated in the 1982 Merger Guidelines issued by U.S. Department of Justice, and it greatly influenced courts in the United States and competition agencies ar