The Sound of One Hand Clapping: The 2010 Merger Guidelines and the Challenge of Judicial Adoption

  • Judd E. Stone
  • Joshua D. Wright


There is ample justification for the consensus view that the Horizontal Merger Guidelines have proven one of antitrust law’s great successes in the grounding of antitrust doctrine within economic learning. The foundation of the Guidelines’ success has been its widespread adoption by federal courts, which have embraced its rigorous underlying economic logic and analytical approach to merger analysis under the Clayton Act. While some have suggested that the Guidelines’ most recent iteration might jeopardize this record of judicial adoption by downplaying the role of market definition and updating its unilateral effects analysis, we believe that these updates are generally beneficial and include long-overdue shifts away from antiquated structural presumptions in favor of analyzing competitive effects directly where possible. However, this article explores a different reason to be concerned that the 2010 Guidelines may not enjoy widespread judicial adoption: the 2010 Guidelines asymmetrically update economic insights underlying merger analysis. While the 2010 Guidelines’ updated economic thinking on market definition and unilateral effects will likely render the prima facie burden facing plaintiffs easier to satisfy in merger analysis moving forward, and thus have significant practical impact, the Guidelines do not correspondingly update efficiencies analysis, leaving it largely as it first appeared 13 years earlier. We discuss two well-qualified candidates for “economic updates” of efficiencies analysis under the Guidelines: (1) out-of-market efficiencies and (2) fixed-cost savings. We conclude with some thoughts about the implications of the asymmetric updates for judicial adoption of the 2010 Guidelines.


Merger Guidelines Efficiencies Fixed costs Unilateral effects UPP Antitrust 


  1. Antitrust Modernization Comm’n. (2007). Report and recommendations, pp. 58–59.Google Scholar
  2. Baker J. (2003) Responding to developments in economics and the courts: Entry in the merger guidelines. Antitrust Law Journal 71: 189–206Google Scholar
  3. Baye, M. et al. (2010, June 4). Proposed horizontal merger guidelines: Economists’ comment. Retrieved from
  4. Baye, M. & Wright, J. (forthcoming 2011). Is antitrust too complicated for generalist judges? Journal of Law & Economics, 54. Retrieved from
  5. Brannon, L. & Bradish, K. (2010). The revised horizontal merger guidelines: Can the courts be persuaded? Antitrust Source. Retrieved 1–4 October, 2010, from
  6. Brown Shoe Co. v. U.S. (1962). 370 U.S. 294.Google Scholar
  7. Carlton D. (2010) Revising the horizontal merger guidelines. Journal of Competition Law and Economics 6(3): 619–652CrossRefGoogle Scholar
  8. Coate, M. & Heimert, A. (2009). Merger efficiencies at the Federal Trade Commission 1997–2007. Retrieved from
  9. Comment of Scheffman, Director, Bureau of Economics, Federal Trade Commission. (2002, December 10). Understanding mergers: Strategy & planning, implementation and outcomes (Transcript of roundtable sponsored by the Bureau of Economics). Retrieved from
  10. Easterbrook F. (1984) The limits of antitrust. Texas Law Review 63: 1–40Google Scholar
  11. Farrell, J. & Shapiro, C. (2010). Antitrust evaluation of horizontal mergers: An economic alternative to market definition. B.E. Journal of Theoretical Economics, 10. Retrieved from
  12. FTC v. Procter & Gamble Co. (1967). 386 U.S. 568.Google Scholar
  13. FTC v. Staples, Inc. (D.D.C. 1997). 970 F. Supp. 1066.Google Scholar
  14. Kattan J. (1994) Efficiencies and merger analysis. Antitrust Law Journal 62: 513–535Google Scholar
  15. Kolasky W., Dick A. (2003) The merger guidelines and the integration of efficiencies into antitrust review of horizontal mergers. Antitrust Law Journal 71: 207–251Google Scholar
  16. Kovacic W. (2003) The modern evolution of competition policy enforcement norms. Antitrust Law Journal 71: 377–478Google Scholar
  17. Muris, T. & Sayyed, B. (2010). Three key principles for revising the horizontal merger guidelines. Antitrust Source. Retrieved April 1–13, 2010, from
  18. Posner R. (2001). Antitrust Law (2nd Ed.).Google Scholar
  19. RSR Corp. v. FTC, 602 F.2d 1317, 1325 (9th Cir. 1979).Google Scholar
  20. Salop, S. & Moresi, S. (2009, November). Updating the merger guidelines: Comments, horizontal merger guidelines review project. Retrieved from
  21. Salop, S. & Moresi, S. (2010). Horizontal merger guidelines: Summary of proposed revisions. Retrieved from
  22. Shapiro C. (2010) The 2010 horizontal merger guidelines: From hedgehog to fox in forty years. Antitrust Law Journal 77: 49–107Google Scholar
  23. Shapiro, C. (2010b, November 18). Update from the Antitrust Division (Remarks as prepared for the antitrust Bar association section of antitrust law fall forum, Washington, D.C.). Retrieved from
  24. U.S. Dep’t of Justice. (1982). Merger guidelines.Google Scholar
  25. U.S Dep’t of Justice & Fed. Trade Comm’n. (2006). Commentary on the horizontal merger guidelines. Retrieved from
  26. U.S. Dep’t of Justice & Fed. Trade Comm’n. (1992). Horizontal merger guidelines.Google Scholar
  27. U.S. Dep’t of Justice & Fed. Trade Comm’n. (as amended Apr. 8, 1997). Horizontal merger guidelines Section 4. Retrieved from
  28. U.S. Dep’t of Justice & Fed. Trade Comm’n. (2010). Horizontal merger guidelines. Retrieved from
  29. U.S. v. Philadelphia Nat’l Bank. (1963). 374 U.S. 321.Google Scholar
  30. U.S. v. Von’s Grocery. (1966). 380 U.S. 270.Google Scholar
  31. United States v. Kinder. (2d Cir. 1995). 64 F.3d 757, 771–772.Google Scholar
  32. Wall, D. & Kaiser, H. (2010, April 24). What the new merger guidelines mean for technology companies. Retrieved from
  33. Wright, J. (2010a, October 26). Will federal courts adopt the 2010 HMGs? Truth on the market. Retrieved from
  34. Wright, J. (2010b, May 31). Comment on the proposed update on the horizontal merger guidelines: Accounting for out-of-market efficiencies. Retrieved from

Copyright information

© Springer Science+Business Media, LLC. 2011

Authors and Affiliations

  1. 1.Alaska Supreme CourtFairbanksUSA
  2. 2.Department of EconomicsGeorge Mason University School of LawArlingtonUSA

Personalised recommendations