Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

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Sunday, August 24, 2008

Who Defines the Relevant Market—The Core Customer or the Marginal One?

Posted by D. Daniel Sokol

Sumanth Addanki
(NERA) and Jeff Daskin (NERA) assess the reasoning by the Court of Appeals that the District Court committed an error in assuming that market definition must depend on the actions of marginal consumers. Their conclusion is that the behavior of marginal customers is and should be the focus of an analysis of market definition. This does not mean, however, that core customers are ignored. As Sumanth and Jeff explain, whether there is a set of core customers who might be adversely affected by a transaction will also depend on the number of marginal consumers and their behavior in response to an increase in price.
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