The Hypothetical Monopolist Test In Antitrust Law

In 2009 the State Anti-Monopoly Committee legislated a "Guidelines on relevant market definition" (hereinafter referred as " Guidelines "). The legislation and Research of antitrust law in China is relatively late, this Guideline is the initial achievement in this field. " Guidelines " introduced the hypothetical monopolist test as a new method for defining markets. The hypothetical monopolist test in Antitrust Law is also called the SSNIP Test (Small but Significant Not-transitory Increase in Price).Hypothetical monopolist test is seen as a thought experiment. viewed as a thought experiment. It attempts to enable exact market definition for the relevant product and geographic market, based on the demand elasticity and cross-price elasticity.In a mature market economy countries and regions, such as the United States and the European Union, the hypothetical monopolist test play an important role in judicial practice in the antitrust laws,it has become the main method of defining the relevant market.In the study of the Hypothetical monopolist test, this paper uses a comparative economic analysis of law, empirical analysis and case analysis.Chapter one is the focus of this article. First of all author research the History of the development of method of defining the relevant market, to sort out the process of hypothetical monopolist test's Formation and Development. Then author will introduce in detail the Procedure and important factors of the hypothetical monopolist. Chapter two is the innovative part of this paper. Economic analysis of law as the theoretical support, author compare firstly the economic principles behind the hypothetical monopolist test and the traditional definition of alternative markets. The hypothetical monopolist test take account of behavior of the "marginal consumer", but the traditional method take account of behavior of "rational consumer" . Then discussed the advantages and the limitations of both methods.In Chapter three author evaluate the the provisions about the hypothetical monopolist test in " Guidelines ".Then author make some suggestions to improve legislation and enforcement of defining the relevant market.