Hastings International and Comparative Law Review


Oligopoly industry structure, where a small number of firms dominate a large percentage of the market, is prominent in American business. Antitrust scholars debate about how an oligopoly firm sets its prices and whether the prices are competitive. Some scholars believe that United States law allows oligopolists to avoid detecting and punishment for collusive pricing activities. This Note compares two approaches to proving collusion in oligopolistic industries. One approach is proposed by Richard A. Posner and the other is presently utilized by the European Court of Justice for the European Economic Community. The author urges that United States courts adopt an approach similar to that of the European Economic Community and analyze the structure and performance of oligopolistic industries. Under that approach, economic evidence of the use of price facilitation mechanisms should justify drawing an inference of illegal collusion.