The Research Of The Economic Analytical Methods In The Regulation Of Merger Anti-monopoly Law

Every law needs a set of effective analytical methods, otherwise it would be remained on the paper only, and could not be transformed into a real "living law". The purpose of anti-monopoly law is to maintain market effective competition, and promote the healthy development of the market economy, and thus it is closely linked with the market economic activity. Therefore, since the date of its birth, the anti-monopoly law and economic theory and analytical methods exist inextricably relationship. As the modern anti-monopoly law, more and more deeply influenced by economics, many economic theories and the analysis method has become the theoretical basis and of antitrust laws to deal with the issue of competition in the market, and the main analytical tools of the anti-monopoly law, to deal with the issue of competition in the market.The merger as the one of the three major components of anti-monopoly law, it focus on the fundamental problem is that, the impact of the merger on the market to compete effectively, namely how to the market competition condition after the merger.If the merger would adversely effects on market competition, the anti-monopoly law should prevent it, and vice versa. What adverse effects on market competition resulted from the merger? From the provisions of the anti-monopoly law, it is mainly manifested in two aspects:one is created or strengthened a dominant market position, namely unilateral effects; two is convenient to reach the coordination or collusion between firms, namely the coordinated effect. This rule seems to be very clear, easy to let people know and understand. But in practice, the concrete operation and analysis is much more complicated, because it contained many anti-monopoly law knowledge and principles, such as the definition of the relevant market, the calculation of the market share of, and the evaluation of efficiency and so on, and these knowledge and principle is inextricably linked with economic theory and analytical methods. Therefore, in order to properly assess the competitive effects of the merger, it must be by means of a large number of economic theory and analytical methods. Although our country’s anti-monopoly law has been promulgated five years, but our country has yet not mastered enough of the anti-monopoly laws of economic theory and analytical methods, and could not be used those theory and method in specific cases accurately and skillfully, this increased the difficulty of the implementation and enforcement of our anti-monopoly laws, especially the anti-monopoly regulation of the merger. Although our country has already dealt with a lot of merger cases, but those cases have been faced many Controversy and doubts, this is obviously not conducive to the realization of the anti-monopoly regulation purpose of the merger, and therefore we should strengthen the research of the economic analytical method of the merger anti-monopoly law regulationThe analysis step of the merger competitive effect is:firstly, to define the relevant market, it includes the relevant product market and the relevant geographic market. In the relevant market definition process, we should take into account the demand-side substitution, supply-side substitution, chains of substitution, and other factors. This involves many economic analytical methods, such as price elasticity analyses, Lerner index, SSNIP test, as well as the diversion ratio of product. Secondly, to examine whether the firm or not has the market power. The primary criterion for assessment of market power is market share, but it is not the only standard to determine the market power. Even if the firm’s market share reaches the statutory minimum threshold, we should also take account of buyer power, potential competition, innovation, complementary products and other factors. Here, this involves the hypothetical monopoly test, price correlation analysis, efficiency analysis and so on. Finally, to analyze the influence of the merger to market competition, if the merger would not created adverse effects on the market competition, it would not be prohibited, and vice versa. This process involves the economic analytical methods are:simulation models, structure models, regression analysis, market transparency, punishment retaliation mechanism and so on.Regardless in which stage, the economic empirical analytical.methods are very important, because they could provide the strong evidence to support our analysis results. In addition, the specific analytical method of horizontal merger and vertical merger and conglomerate merger are different, when we examine their competitive effects, they should be treated the same.