Unilateral Effects Research Articles

A continuum anisotropic damage model with unilateral effect

Abstract. A continuum damage mechanics model has been derived within the framework of irreversible thermodynamics with internal variables in order to describe the behaviour of quasi-brittle materials under various loading paths. The anisotropic character induced by the progressive material degradation is explicitly taken into account, and the Helmholtz free energy is a scalar function of the basic invariants of the second order strain and damage tensors. The elastic response varies depending on the closed or open configuration of defects. The constitutive laws derived within the framework of irreversible thermodynamics theory display a dissymmetry as well as unilateral effects under tensile and compressive loading conditions. This approach verifies continuity and uniqueness of the potential energy. An application to uniaxial tension-compression loading shows a good adequacy with experimental results when available, and realistic evolutions for computed stresses and strains otherwise.

Ahead of His Time

Prof. Markovits has been a prescient commenter on antitrust. His early and insightful characterization of the harm from merger as the loss to consumers from being able to trade off their two top choices can be seen in the use of diversion ratios in unilateral effects merger cases. So too does the change in assessing unilateral effects mergers from market concentration to direct measurement of competitive effects match his skepticism of market definition. I share Prof. Markovits’s view that prior dominance should not be a prerequisite for monopolization cases, at least those involving exclusionary practices. I am skeptical that intent should play a role in monopolization, other than as a source of expert evidence that a practice will be harmful. Whether antitrust should be about maximizing consumer welfare or punishing powerful actors with bad intent may be a fundamental divide in perspective in the antitrust community.

Developments in Unilateral Effects Analysis: Price Pressure Tests

Arguably the most significant development in horizontal merger assessment in recent years, particularly in the UK and the US, has been the increased use of price pressure tests/indices, which use a relatively limited amount of data from the merging parties and a simple formula to provide an indication of whether a merger is likely to give rise to an increase in prices, i.e. to cause upward pricing pressure. These indices are intended to better capture the extent to which the merging parties are close competitors and hence may be more informative than traditional market share based screens when assessing the prospects for a merger to give rise to unilateral effects in a differentiated products setting. The first part of the paper will review the economics of horizontal mergers and explain the underlying economic intuition upon which pricing pressure indices are based. The paper will then set out the most commonly used of these indices and describe how they may be implemented, elaborating on the empirical inputs and assumptions required, drawing on relevant case law where appropriate. Finally, the paper will comment on the likely future implications of using these indices for merger assessment in South Africa, and the extent to which price pressure indices may be probative regarding the prospects for unilateral effects more generally.

Does Merger Policy Converge after the 2004 European Union Reforms

With almost ten years of experience with the reformed European merger policy, sufficient data has been accumulated to explore the impact of the reform on the difference between the European Union (EU) and the United States (US) merger policy. We expect the EU 2004 reform that established a “significant impediment to effective competition” standard close to the US “substantial lessening of competition” standard would lead to some convergence. We start by identifying changes in the EU regime and verifying the consistency in the US regime. We detect a weaker EU policy for clear dominance and monopoly cases and some changes in its collusion policy after the reform. The incidence of collusion cases falls while EU’s policy, conditional on collusion being the theory of harm, appears stronger. Limited data precludes detailed analysis for the non-dominance unilateral concerns, although the EU data implies stability in the challenge probability associated with that type of case. The US results remain stable over time. Decompositions show some convergence in policy for unilateral cases and non-parametric analysis shows further convergence occurs in unilateral effects analysis. Matching analysis is attempted, but fails to generate any results, because even adjusted, the two sample distributions are not sufficiently balanced, so we must rely on the structural form assumptions of our logit models.

Modeling of reinforced concrete structural members for engineering purposes

When approached using nonlinear finite element (FE) techniques, structural analyses generate,for real RC structures, large complex numerical problems. Damage is a major part of concrete behavior, and the discretization technique is critical to limiting the size of the problem. Based on previous work, the u damage model has been designed to activate the various damage effects correlated with monotonic and cyclic loading, including unilateral effects. Assumptions are formulated to simplify constitutive relationships while still allowing for a correct description of the main nonlinear effects. After presenting classical 2D finite element applications on structural elements, an enhanced simplified FE description including a damage description and based on the use of multi-fiber beam elements is provided. Improvements to this description are introduced both to prevent dependency on mesh size as damage evolves and to take into account specific phenomena (permanent strains and damping, steel-concrete debonding). Applications on RC structures subjected to cyclic loads are discussed, and results lead to justifying the various concepts and assumptions explained.

Ahead of His Time: The Singular Contributions of Richard Markovits

Prof. Markovits has been a prescient commenter on antitrust. His early and insightful characterization of the harm from merger as the loss to consumers from being able to trade off their two top choices can be seen in the use of diversion ratios in unilateral effects merger cases. So too does the change in assessing unilateral effects mergers from market concentration to direct measurement of competitive effects match his skepticism of market definition. I share Prof. Markovits’s view that prior dominance should not be a prerequisite for monopolization cases, at least those involving exclusionary practices. I am skeptical that intent should play a role in monopolization, other than as a source of expert evidence that a practice will be harmful. Whether antitrust should be about maximizing consumer welfare or punishing powerful actors with bad intent may be a fundamental divide in perspective in the antitrust community.

Re-Imagining Antitrust: The Revisionist Work of Richard S. Markovits

This review discusses Richard Markovits’ two volume book Economics and the Interpretation and Application of U.S. and E.U. Antitrust Law (2014), focusing mainly on Markovits’ approaches to antitrust tests of illegality, pricing offenses, market definition and the assessment of market power, and his important work anticipating theory in merger cases. Markovits argues forcefully that the Sherman and Clayton Acts were intended to employ different tests of illegality. As a result, even when they cover the same practices, such as mergers, exclusive dealing, or tying, they address them under different tests. He then shows how he would analyze various practices under the two statutes, discussing virtually every practice that has been the subject of significant antitrust litigation. He also discusses, more briefly, the competition law of the European Union.Among Markovits’ most influential contributions to antitrust policy is his critique of traditional antitrust approaches to market power and market definition. His work was highly influential in the development of modern unilateral effects theories of merger analysis. A provocative question that Markovits’ work invites is whether the approach can or should be extended beyond merger cases. The Supreme Court has insisted that relevant markets be defined in Sherman Act §2 cases, as well as for §1 cases under the rule of reason. No lower court today would be likely to find traditional market definition unnecessary in those areas without new Supreme Court guidance. The same thing is very likely true for tying or exclusive dealing cases requiring assessment of market foreclosure. One fact seems inescapable: if the logic of analysis applies to mergers, then it should apply equally to other antitrust practices that serve to eliminate or blunt competition between reasonably adjacent firms in differentiated markets. For example, a firm that predates its closest rival into bankruptcy may be able to induce a price increase, just as much as a merger between these same two firms. Indeed, the industrial organization literature often treats merger and predation as alternative ways of eliminating a rival. The same thing could also be true of tying or exclusive dealing intended to deny a relatively close rival access to a market, as well as loyalty discounts. All of these could be used in differentiated markets to exclude reasonably proximate rivals, with the result that prices increase.Ironically, giving legal recognition to the problem of eliminating competition in mergers, while denying recognition in nonmerger cases arising in the same market settings, gives firms the incentive to employ the pricing or contractual exclusion strategies rather than merger. One perverse result may be that the elimination of competition will occur, but without the offsetting efficiencies that at least some mergers can provide.

A Legal Commentary on the 'Economics of Unilateral Effects' by Marc Ivaldi, Bruno Jullien, Patrick Rey, Paul Seabright & Jean Tirole

My task is to comment upon the “Economics of Unilateral Effects” by Marc Ivaldi, Bruno Jullien, Patrick Rey, Paul Seabright & Jean Tirole – a report that is presented at the website of the European Commission. My examination does not comment on a technical economic analysis. Instead, it constitutes a legal comment on the certain inadequacies of economic examination and on its gross errors. In law, one is never pedantic: the highest precision and attention to each and every word are necessary and obligatory. By contrast, economic analyses are often unreadable for a lawyer. Economists adopt certain definitions in handbooks, and use them in their professional papers according to the memorized notions. That is not what law is all about.

A thermodynamically consistent nonlocal damage model for concrete materials with unilateral effects

Abstract This paper proposes a thermodynamically consistent constitutive model for concrete materials to solve several problems encountered in the existing damage modeling. Two separated equivalent strains and the corresponding new damage evolution laws are used to enhance the representation of asymmetrical behaviors of concrete, of which the different strengths and post-peak behaviors between tension and compression cannot simultaneously be reproduced by the classical strain-driven models. The crack opening–closure criterion related to the unilateral effect is described, using the trace of the strain tensor rather than the spectral decomposition of a specific second-order tensor, which leads to either a discontinuous stress–strain response or spurious energy dissipation upon closed load cycles. An integral-type nonlocal regularization is incorporated to solve the problem of strain-softening induced mesh non-objectivity involving mesh-size and mesh-bias dependencies. The strain-driven formalism and the explicit integration of constitutive equations improve the robustness of the numerical algorithm. Correlative studies using available benchmark test results are presented to demonstrate the performance of the model.

Unilateral Effects Analysis in Differentiated Product Markets: Guidelines, Policy, and Change

The Merger Guidelines highlight unilateral effects analysis as the primary anticompetitive theory in differentiated product markets. This study evaluates the Federal Trade Commission’s historical record to determine what considerations drive the internal review process, if these considerations depend on the type of competition within the differentiated market under review, and if policy has changed much over the 20 years since the 1992 Merger Guidelines were issued. The results identify the importance of price-based competition to the analysis, as markets that are characterized by price competition tend to generate significantly higher estimates for the probability of a unilateral effects finding, all else equal, especially when repositioning is difficult. Moreover, a little fluctuation is detected in policy, but no real evidence of change over the 20-year period of the study exists.

Brittle Damage in Initially Anisotropic Materials: A Model Accounting for the Induced Anisotropy and Unilateral Effects

A new micromechanical modelling approach for brittle damage in initially orthotropic materials is presented. The proposed strain-based energy formulation allows to derive a fully anisotropic multilinear model for microcracked materials with arbitrary oriented defects. The thermodynamics framework provides a standard procedure for the damage evolution law. The new model explicitly accounts for the interaction between primary and induced anisotropies. Moreover, the very challenging issue of opening-closure effects (unilateral behavior) is addressed in this framework.

The Proposed Merger of Staples and Office Depot: Lessons from History and New Competitive Concerns

The proposed combination of Staples and Office Depot presents the Federal Trade Commission (FTC) with a host of merger review challenges. The transaction follows closely on the heels of the Office Depot/OfficeMax merger in 2013 and would complete a rapid 3-1 consolidation of the office supply superstore (OSS) market. Both retail and business-to-business customers may be significantly affected by the proposed transaction. The deal puts front and center the question whether evolving alternative business models for the sale of consumable office supplies are a viable substitute for OSSs. It also raises issues that the Commission recently addressed in the successfully enjoined merger of national broadline food service distributors Sysco and U.S. Foods - namely that a merger of the only two rivals in a national market may have adverse unilateral effects in a targeted customer market.The American Antitrust Institute (AAI) is concerned that the proposed transaction may substantially lessen competition in the market for the sale of consumable office supplies to large multi-regional or national customers on a contract basis (hereinafter “enterprise customer market” or “enterprise market”). In particular, we are concerned that the proposed transaction threatens substantial unilateral anticompetitive effects that alternative supply responses could not ameliorate, and that harm to customers in this market will be passed on to consumers. Some of these harms implicate unique dimensions of quality competition involving cyber security and supply chain stability. We also raise questions as to whether rapid 3-1 consolidation threatens to reverse recent positive competitive developments in the retail office supply market, as well as the competitive significance of merging the only “omnichannel” retailers principally devoted to office supplies.The analysis in this white paper is based on our review of publicly available information and conversations with industry experts and analysts. Because we do not have access to confidential or proprietary information that the Commission collects in the course of its investigation, we draw no conclusions as to whether the merger violates Section 7 of the Clayton Act. However, our analysis makes clear that the proposed merger warrants very close scrutiny by the Commission. Major themes that emerge from this analysis include: The Commission should determine whether there is a distinct relevant product market for the sale of consumable office supplies to large “enterprise” office supply customers on a contract basis, and if so, who participates in this market. This is consistent with the Commission’s successful approach to defining targeted customer markets in Sysco v. Fed. Trade Comm’n.The enterprise contract market likely is a relevant antitrust market because enterprise customers have no viable substitutes for the product and service offerings provided by OSSs. The next largest rivals are distant to Staples and Office Depot and are unable to compete on the scale and scope of the merging parties. Moreover, the merging firms may be the only participants in this market, because potential supply-side responses likely would fail to defeat a post-merger price increase in the market.The proposed transaction threatens substantial unilateral anticompetitive effects in the enterprise market, and possibly also in the broader market for all contract customers. Potential anticompetitive harm arises not only from the loss of ordinary head-to-head competition between the merging firms, which is substantial, but also from the loss of competition to provide superior cyber security to contract customers and by increased supply chain fragility resulting from elimination of any redundancy in the OSS channel. Potential anticompetitive effects are unlikely to be mitigated by repositioning or new entry.In its 2013 review of the OfficeDepot/OfficeMax merger, the Commission likely did not go far enough in distinguishing among competitive dynamics within and across the retail distribution channels through which OSSs provide products to end consumers. Although competition in the pure online retail channel is likely disciplined by national competition from Amazon and others, there are competitive concerns in the traditional superstore channel and in the emergence of omnichannel stores that warrant careful attention.

A Comment on Choosing Among Tools for Assessing Unilateral Effects Analysis

In a recent paper, Gregory Werden and Luke Froeb present a general discussion of unilateral effects analysis with a particular focus on factors that limit the applicability of the Upward Pressure on Price (UPP) model. In one of our earlier papers, we had provided simple simulations showing that the application of UPP in the broad manner suggested by Farrell and Shapiro could be used to dramatically expand the universe of mergers subject to challenge. Werden and Froeb, in contrast to Farrell and Shapiro, see application of UPP screening as constrained by Bertrand competition, an assumption that implies our simulations over-estimate the potential for the UPP model to increase enforcement. Moreover, they posit that merger simulation is well suited for use in either screening or competitive effects’ analysis, a result, which if true, would marginalize the UPP model. We disagree with their observations, noting that the UPP methodology, as described by Farrell and Shapiro, is designed to be agnostic to the underlying competitive process, and potentially applicable in a range of situations in which simulation would be infeasible. As a result, our simulations do not over-estimate the extent to which a broad application of UPP could possibly expand merger enforcement. We also stress the importance of verifying the predictions of any theoretical model (including an UPP analysis generalized to predict actual price effects) with empirical evidence as an important tool to realistically limit the analysis. Successful substantiation would be necessary to allow the analysis to survive a Daubert challenge. Under Daubert, experts must move beyond theory that is generally accepted in their fields and present evidence to the court to show that the theory fits the facts at issue and is reliably predictive.

A microcracks-induced damage model for initially anisotropic rocks accounting for microcracks closure

We formulate a new micromechanical damage model for anisotropic rocks. This model accounts not only for the coupling between material initial anisotropy and the damage-induced one, but also for the opening/closure status (the so-called unilateral effects) of evolving microcracks. A closed-form expression of the overall free energy of the microcracked medium is implemented in an appropriate thermodynamics framework to derive a complete damage model for initially anisotropic rocks. The salient features of this model are fully illustrated. Then, its capabilities are demonstrated through an application to a Taiwan argillite subjected to direct tensile loading (including off-axis ones) for which the damage model well captures experimental data (mechanical response, growing damage rocks strength). Finally, the response of the studied rock along a tensile loading followed by an unloading and a reloading in compression is provided in order to illustrate the so-called unilateral damage effects due to microcracks closure.

Unilateral Effects Screens for Partial Horizontal Acquisitions: The Generalized HHI and GUPPI

Recent years have witnessed an increased interest, by competition agencies, in assessing the competitive effects of partial acquisitions. We propose a generalization to a partial horizontal acquisition setting of the two most traditional indicators used to screen unilateral anti-competitive effects: the Helfindahl-Hirschman Index and the Gross Upward Price Pressure Index. The proposed generalized indicators can deal with all types of acquisitions that may lessen competition in the industry: acquisitions by owners that are internal to the industry (rival firms) and engage in cross-ownership, as well as acquisitions by owners that are external to the industry and engage in common-ownership. Furthermore, these indicators can deal with direct and indirect acquisitions, which may or may not correspond to control, and nest full mergers as a special case. We provide an empirical application to several acquisitions in the wet shaving industry. The results seem to suggest that (i) a full merger induces higher unilateral anti-competitive effects than a partial controlling acquisition involving the same firms, (ii) a partial controlling acquisition induces higher unilateral anti-competitive effects than a partial non-controlling acquisition involving the same firms and the same financial stakes, and (iii) an acquisition by owners that are internal to the industry induces higher unilateral anti-competitive effects than an acquisition (involving the same firms and the same stakes) by external owners that participate in more than one competitor firm.

Predicting Competitive Effects from Prescription Drug Mergers: How Standard Economic Analysis Can Go Wrong

Key insights on the unilateral competitive effects of mergers derive from economic models built on behavioral assumptions and mathematical regularity conditions ensuring that merger effects are determined by the premerger margin of competition between products combined. But the usual behavioral assumptions and regularity conditions might not hold for prescription drugs, and the usual insights might not apply. Analysis of a simple model based on the facts of FTC v. Lundbeck shows that weak competition between two therapeutic substitute drugs plausibly results in monopoly prices, so merging them has no effect on their prices.

Why is Cournot Cournot and Bertrand Bertrand? The Role of the Strategic Variable in One-Shot Oligopoly Games

In Cournot games the strategic variable is output and players maximize profits assuming that the other players keep their outputs fixed. In Bertrand games the strategic variable is price and players assume the other players to keep their prices fixed. In this article I argue that it is not the strategic variable what determines the equilibrium of the game, but what is assumed fixed. A game in which firms set prices but assume the other firms to keep their outputs fixed leads to the Cournot equilibrium and when firms set outputs but assume prices fixed, the Bertrand equilibrium is obtained. In general, what matters for the equilibrium is not what you set but what you assume fixed. This insight has a bearing on discussions about what kind of competition is most likely to occur in markets with certain characteristics. It also has a bearing on the Nash character of the equilibria. Moreover, the diminished role for the strategic variable fundamentally affects the analysis of unilateral effects from mergers and tacit collusion.

Unilateral Effects Analysis in Merger Review: Limits and Opportunities

Many economists believe that unilateral effects analysis should dominate the merger review process for differentiated products. However, it is far from clear if these theoretical models are broadly applicable, as they impose monopoly-style entry assumptions that constrain the competitive process. By abstracting from the complexities of the market process, the standard unilateral effects analysis gives rise to tractable mathematical equilibriums. Of course, the equilibriums may not offer insights if the key assumptions are not valid. This paper will explore the limits to and opportunities for unilateral effects analysis, using the Landes-Posner model of a dominant firm as an initial example, before expanding the discussion to Nash-Bertrand models of competition. These Lerner-based modeling structures are problematic, especially when the entry-related assumptions are not credible. Because economic models may remain applicable even when their assumptions are not valid, the discussion addresses various types of effects evidence that could confirm the predictions of a specific unilateral effects model. Court precedent is reviewed, with an emphasis on a current understanding of the structural presumption, along with the applicability of effects evidence to litigation. By focusing the analysis on facts, unilateral effects analysis serves to aid the merger review process.

Abnormal Parietal Brain Function in ADHD: Replication and Extension of Previous EEG Beta Asymmetry Findings.

Background: Abundant work indicates ADHD abnormal posterior brain structure and function, including abnormal structural and functional asymmetries and reduced corpus callosum size. However, this literature has attracted considerably less research interest than fronto-striatal findings.Objective: To help address this imbalance, the current study replicates and extends our previous work showing abnormal parietal brain function in ADHD adults during the Conner’s Continuous Performance Test (CPT).Method: Our previous study found that ADHD adults had increased rightward EEG beta (16–21 Hz) asymmetry in inferior parietal brain regions during the CPT (p = 0.00001), and that this metric exhibited a lack of normal correlation (i.e., observed in controls) with beta asymmetry at temporal–parietal regions. We re-tested these effects in a new ADHD sample and with both new and old samples combined. We additionally examined: (a) EEG asymmetry in multiple frequency bands, (b) unilateral effects for all asymmetry findings, and (c) the association between EEG asymmetry and a battery of cognitive tests.Results: We replicated our original findings by demonstrating abnormal rightward inferior parietal beta asymmetry in adults with ADHD during the CPT, and again this metric exhibited abnormal reduced correlation to temporal–parietal beta asymmetry. Novel analyses also demonstrated a broader pattern of rightward beta and theta asymmetry across inferior, superior, and temporal–parietal brain regions, and showed that rightward parietal asymmetry in ADHD was atypically associated with multiple cognitive tests.Conclusion: Abnormal increased rightward parietal EEG beta asymmetry is an important feature of ADHD. We speculate that this phenotype may occur with any form of impaired capacity for top-down task-directed control over sensory encoding functions, and that it may reflect associated increase of attentional shifting and compensatory sustained/selective attention.

Anisotropic unilateral damage with initial orthotropy: A micromechanics-based approach

A micromechanics-based damage model able to describe the brittle response of initially anisotropic materials is presented. A special emphasis is put on the account of damage-induced anisotropy and unilateral behaviour related to microcracks closure effects. These both features clearly influence the inelastic deformation of microcracked materials and lead to even more complex consequences in the context of initial anisotropy. The aim of this work is then to derive a new strain-based formulation which allows representing the related interactions between all these phenomena. This is achieved through a recent two-dimensional energy-based micromechanical analysis that accounts for the fully anisotropic multilinear response of orthotropic materials weakened by arbitrarily oriented microcracks. On the other hand, the thermodynamics framework gives a standard procedure for the development of the damage evolution law. Throughout the paper, attention is put on the mathematical and thermodynamical consistency of the model to avoid difficulties usually associated to the simultaneous description of damage-induced anisotropy and unilateral effects. In addition to elastic constants, the model requires the identification of only two parameters related to damage evolution. The model has been implemented within the commercial finite-element code ABAQUS, and various numerical simulations are presented to illustrate its capabilities. Especially, evolution of the material symmetry and influence of opening-closure states of microcracks on the damage process are illustrated in the case of brittle matrix composites subjected to different loading cases (axis and off-axis loads, tension and compression, tension followed by compression).