Blaw Ch 27

Front 1

per se violation

Back 1

A type of anticompetitive agreementsuch as a horizontal price-fixing agreementthat is considered to be so injurious to the public that there is no need to determine whether it actually injures market competition; rather, it is in itself (per se) a violation of the Sherman Act.

Front 2

concentrated industry

Back 2

An industry in which a large percentage of market sales is controlled by either a single firm or a small number of firms.

Front 3

conglomerate merger

Back 3

A merger between firms that do not compete with each other because they are in different markets (as opposed to horizontal and vertical mergers).

Front 4

exclusive-dealing contract

Back 4

An agreement under which a seller forbids a buyer to purchase products from the seller's competitors.

Front 5

group boycott

Back 5

The refusal to deal with a particular person or firm by a group of competitors; prohibited by the Sherman Act.

Front 6

Herfindahl-Hirschman index (HHI)

Back 6

An index of market power used to calculate whether a merger of two businesses will result in sufficient monopoly power to violate antitrust laws.

Front 7

horizontal market division

Back 7

A market division that occurs when competitors agree to divide up the market for their products or services among themselves, either geographically or by functional class of customers (such as retailers or wholesalers). Such market division constitutes a per se violation of the Sherman Act.

Front 8

horizontal merger

Back 8

A merger between two firms that are competing in the same market.

Front 9

horizontal restraint

Back 9

Any agreement that in some way restrains competition between rival firms competing in the same market.

Front 10

market concentration

Back 10

A situation that exists when a small number of firms share the market for a particular good or service. For example, if the four largest grocery stores in Chicago accounted for 80 percent of all retail food sales, the market clearly would be concentrated in those four firms.

Front 11

price discrimination

Back 11

Setting prices in such a way that two competing buyers pay two different prices for an identical product or service.

Front 12

price fixing

Back 12

Fixingby means of an anticompetitive agreement between competitorsthe prices of products or services.

Front 13

resale price maintenance agreement

Back 13

An agreement between a manufacturer and a retailer in which the manufacturer specifies the minimum retail price of its products.

Front 14

rule of reason

Back 14

A test by which a court balances the positive effects (such as economic efficiency) of an agreement against its potentially anticompetitive effects. In antitrust litigation, many practices are analyzed under the rule of reason.

Front 15

tying arrangement

Back 15

An agreement between a buyer and a seller in which the buyer of a specific product or service becomes obligated to purchase additional products or services from the seller.

Front 16

vertical merger

Back 16

The acquisition by a company at one stage of production of a company at a higher or lower stage of production (such as a company merging with one of its suppliers or retailers).

Front 17

vertical restraint

Back 17

Any restraint on trade created by agreements between firms at different levels in the manufacturing and distribution process.

Front 18

vertically integrated firm

Back 18

A firm that carries out two or more functional phasesfor example, manufacture, distribution, retailingof a product.