Focuses on firms’ use of anti-competitive practices to prevent or restrict competition. This includes but is not limited to predatory pricing, transfer pricing, price fixing, geographic monopolies and dividing territories, dumping, exclusive dealing and bid rigging.
Corporate competitive behavior of firms is a function of both governmental regulations and law as well as market forces. Suppliers, new entrants into the market, substitute products, and buyer bargaining all affect competitive behavior, as do technological and other forms of innovation. Anti-competitive behaviors include dumping, outright price fixing, predatory pricing, exclusive dealing, territorial division among firms, resale price maintenance, cross subsidization, transfer pricing, and bid rigging. However, not all competitive behavior is a function of price, particularly in imperfect markets where a small number of firms have dominant market share. Government involvement in competitive behavior takes the form of the regulation of pricing behavior, patent and copyright law, or laws specifically designed to eliminate competitive behavior.