Editing Predatory pricing (section)

====Two tier approach====
Joskow and Klevorick offer a two-tier approach to identify predatory pricing. The first stage involves an analysis of the structural characteristics of the relevant market and the market power of the firm allegedly engaging in anti-competitive behaviour.<ref name="Joskow, PL 1979, pp. 213-270">{{Cite journal |last=Joskow |first=Paul L. |last2=Klevorick |first2=Alvin K. |date=1979 |title=A Framework for Analyzing Predatory Pricing Policy |url=https://www.jstor.org/stable/795837 |journal=The Yale Law Journal |volume=89 |issue=2 |pages=213–270 |doi=10.2307/795837 |issn=0044-0094|url-access=subscription }}</ref> The plaintiff must demonstrate that the market in which the behaviour occurred would be prone to predatory pricing and cause losses in economic efficiency. The second stage involves behavioural considerations which may demonstrate predation such as the dominant firm pricing below average variable cost.<ref name="Joskow, PL 1979, pp. 213-270"/>

'''The Brooke Group rule'''

The Brooke Group rule was established by the US Supreme Court in 1993 for the particular case involving Brooke Group Ltd. v. Brown & Williamson Tobacco Corporation. Under this rule, to be found guilty of predatory pricing, the plaintiff was to prove the following:

# Defendant set prices to below own cost of production.
# If successful in driving competitors from the market, defendant had high probability of recouping losses through increase in prices in the long-term.
# Defendant had clear intent to engage in predatory pricing

The first element can be proven with sufficient evidence of defendant's costs in the production of their goods and services. The second element can be proven with evidence of the defendant's barriers to entry, market power and other evidence that would likely lead to the increase in prices in the future. The third element would require direct evidence to clearly demonstrate the defendant's plans to manipulate the market through use of predatory pricing strategy. This may be found through capture of firm's internal documents or plans.<ref>{{Cite web |title=Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209 (1993) |url=https://supreme.justia.com/cases/federal/us/509/209/ |access-date=2023-04-24 |website=Justia Law |language=en}}</ref>

If all elements can be proven with sufficient evidence for each, following the Brooke Group rule, the plaintiff may claim for predatory pricing under the US antitrust law.<ref>{{Cite journal |last=Areeda, Hovenkamp |first=P., H. |date=2013 |title=Antitrust Law: An Analysis of Antitrust Principles and Their Application |journal=New York: Wolters Kluwer |issue=4}}</ref>