An Explanation of Market Dominances

Posted by D. Daniel Sokol

Massimiliano Vatiero Law and Economics, University of Siena (PhD Student) offers An Explanation of Market Dominances.

ABSTRACT: This paper tries to formulate an original description of notion of abusive dominant position. A dominant position is a common market structure, where there is more than one competitor (hence, it is not a monopoly), but where one firm (or a group of firms, but not all) has some kind of market significance (thus, it is not a perfect atomistic competition context). To understand dominant position dynamics, we have to depart from the idea of imperfect competition in order to relax the assumption that price contains any information and to regard strategic rationality by agents. In particular we focus on the meaning of joint dominance. We illustrate by the notion of conjectural variations economic links involved in a joint dominance and we distinguish different forms of joint dominance deriving from the notion of Commonsian transaction.