Geographic Market Definition under the U. S. Department of Justice Merger Guidelines

T HERE is a considerable body of literature discussing how geographic markets should be delineated for antitrust purposes. Noteworthy contributions include Elzinga and Hogarty,1 Shrieves,2 Horowitz,3 Stigler and Sherwin,4 and the collection of papers in the volume edited by Elzinga and Rogowsky.5 The 1982 Department of Justice Merger Guidelines (hereafter Guidelines) and their revision in 1984 provide a new methodology for defining markets relevant for antitrust purposes and elaborate on how this definition should be applied in a geographic market context.6 This paper has four purposes. (1) We analyze the underlying economic model of the Guidelines' treatment of geographic markets.7 The basis of