Our Curious Amalgam #319 Can We Define Overlapping Markets? Understanding the Legal and Economic Arguments
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Mar 31, 2025 In this engaging discussion, Keith Klovers, Counsel at Latham & Watkins LLP and a former advisor to FTC commissioners, delves into the controversial concept of overlapping markets in antitrust law. He argues that these ideas lack solid judicial support, proposing alternative approaches for better market definition. The conversation touches on historical cases, the complexities of two-sided markets, and the implications for competition assessments. Amidst the serious analysis, Keith also shares quirky personal insights, blending humor with expert knowledge.
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Narrowing Grocery Markets
- In grocery, relevant markets have narrowed over time, impacting market share calculations.
- This shift is evident in cases like Vons Grocery (retail grocery), American Stores (supermarkets), and Whole Foods (premium, natural, and organic supermarkets).
Overlapping Markets Analogy
- Overlapping markets are like Russian nesting dolls, with narrower markets nested within broader ones, sometimes five levels deep.
- This complexity shifts antitrust analysis from a simple test to a multiple-choice exam, potentially finding unlawfulness where it didn't exist before.
Economic Criticism of Overlapping Markets
- Defining overlapping markets contradicts economic principles of market power and demand substitution.
- Products either are or aren't competitive constraints; they can't be both simultaneously as overlapping markets suggest.