The Federal Trade Commission's pending antitrust case against Intel challenges a number of Intel's discounting and rebating practices. The Commission appears poised to apply a cost-price test to the challenged practices, but proposes to include "fixed sunk costs" in the appropriate measure of cost. This paper explains the importance of using cost-price screens to assess unilaterally imposed prices and analyzes the futility of including sunk costs in the relevant cost measure.
Antitrust and Trade Regulation | Corporation and Enterprise Law
Date of this Version
Daniel A. Crane, "Predation Analysis and the FTC’s Case against Intel" (May 2010). University of Michigan Program in Law and Economics. Working Paper 16.