Price Discrimination and Competitive Effects: The Standard Oil of Indiana Case

John S. McGee

doi:10.2307/1598105

Has the conduct-based approach to competition law in South Africa led to consistent interpretations of harm to competition?

South African Journal of Economic and Management Sciences ◽

10.4102/sajems.v11i3.461 ◽

2012 ◽

Vol 11 (3) ◽

pp. 292-304

Author(s):

Ryan Hawthorne

Keyword(s):

South Africa ◽

Price Discrimination ◽

Competition Law ◽

Competitive Effect ◽

Competitive Effects ◽

Competitive Action ◽

Economic Foundations

The Competition Act and certain recent decisions by the competition authorities are examined here to assess the extent to which South Africa’s conduct-based approach to competition law has led to consistent outcomes in the assessment of effects on competition. This has not been the case in the assessment of anti-competitive effects among customers or resellers when a supplier accused of an anti-competitive action does not compete with its customers. An anti-competitive effect among customers or resellers is treated as anti-competitive when it arises from some form of conduct, such as price discrimination. However, it is not seen as anti-competitive when it arises from a refusal to supply, for example. Possible reasons for South Africa’s conduct-based approach and this inconsistent outcome in the assessment of competition among customers and resellers, including the economic foundations of the relevant approaches and their relationship with competition law in other jurisdictions, are assessed.

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PRICE DISCRIMINATION IN A FORM OF DISCOUNTS: CATEGORIZATION AND IMPACT ON COMPETITION

Modern Management Review ◽

10.7862/rz.2021.mmr.22 ◽

2021 ◽

Vol 26 (4) ◽

pp. 25-35

Author(s):

Dar`ya Cherednichenko

Keyword(s):

Adverse Effect ◽

Price Discrimination ◽

Exclusive Dealing ◽

Five Dimensions ◽

Coordination Problems ◽

Competitive Effects ◽

Economy Of Scale ◽

Threshold Distribution ◽

Total Welfare ◽

Stimulation Of

This paper is aimed to clarify the definition and categorization of discounts as well as pro- and anticompetitive effects of discounts. The author applied qualitative methods to the research. The modern literature review unfolds the gap of proper discounts definition, which is proposed to be covered by five-dimensions approach to discounts categorization. Based on such aspects of discount scheme as time, product, threshold, distribution level and customer, the approach provides comprehensive and uniform characteristics of discount. It allows assessing effects of competition, which are classified in two groups. Pro-competitive effects include stimulation of demand, decreasing cost due to economy of scale, solving coordination problems within a supply chain. Anti-competitive effects encompass predation scheme, raising rival’s cost, exclusive dealing, leverage and exclusionary bundling. The importance of correct assessment of the discounts by antitrust authorities is high as an overenforcement in this sphere may lead to adverse effect on total welfare.

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The Legal Status of Trade and Functional Price Discounts

Journal of Public Policy & Marketing ◽

10.1177/074391569401300105 ◽

1994 ◽

Vol 13 (1) ◽

pp. 61-75 ◽

Cited By ~ 2

Author(s):

Mark T. Spriggs ◽

John R. Nevin

Keyword(s):

Price Discrimination ◽

Legal Status ◽

Regulatory Agencies ◽

Competitive Effects ◽

Price Discounts ◽

Enforcement Policy ◽

Starting Point ◽

Primary Test ◽

Channel Systems ◽

Number Of Firms

An increasing number of firms have integrated beyond traditional retailer-wholesaler boundaries and now sell the same product through two or more structurally different channel systems. As a result, the historically synonymous definitions for trade and functional price discounts are becoming obsolete. If regulatory agencies continue to use these obsolete definitions, enforcement of the Robinson-Patman Act becomes confused and distributive innovation is inhibited. A price discount's definition determines who is (and is not) entitled to the discount, so the definition is a key starting point for analyzing a discount's competitive effect, which is the primary test under the Robinson-Patman Act. Regulatory agencies should be conscious of the pro-competitive effects of price discounts and follow an enforcement policy that encourages both competition and innovation. The authors clarify trade and functional price discount terminology, discuss the role those discounts play in developing more efficient channel systems, review the existing defenses to price discrimination charges, and conclude with a recommendation for an explicitly recognized availability defense for these types of channel-based price discounts.

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Discounts and their Effects - Economic and Legal Approach

DANUBE Law and Economics Review ◽

10.2478/danb-2014-0015 ◽

2015 ◽

Vol 5 (4) ◽

pp. 277-285

Author(s):

Rastislav Funta

Keyword(s):

Present Article ◽

Price Discrimination ◽

Single Product ◽

Competitive Effects ◽

Positive Effects

Abstract The present article discusses the economic and legal effects of single-product loyalty discounts. It is clear that arguments concerning the “pro-competitive” effects of such discounts must be judged with skepticism. This applies in particular to the assumed effects of loyalty discounts resulting from double profit surcharges or falling average costs, as well as in the context of price discrimination. I argue that many of the alleged effects could also be achieved with discount forms where the risk of restrictive effects on competition should be lower. Also, the assumed anti-competitive effects of loyalty discounts must be better justified economically. This article suggests using a form-based approach for the assessment of discount schemes. However, this should not amount to a restrictive assessment of certain discount schemes. For the development of such a form-based approach, it is necessary to review the theories about pro-competitive and anti-competitive effects. Therefore, this article attempts to identify which positive effects are more likely to be achieved by means of which discount forms and under which circumstances.

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