Dummy variables and fixed effects

March 13, 2024
Fordham’s 48th Annual Conference on International Antitrust Law and Policy

Virtually all antitrust damages estimations are not based on a single product, but on a range of different products (or variants), such as apples and pears. In this context, fixed effects can be crucial to ensure that an overcharge analysis compares apples with apples, and pears with pears. In a new article published in #WuW – Wirtschaft und Wettbewerb (Competition Law & Economics) Johannes Dittrich, Sebastian Panthöfer, and Lars Wiethaus explain the role of dummy variables and fixed effects from a practitioner’s perspective, and in non-technical terms. The article also highlights some of the trade-offs associated with dummy variables and fixed effects and clarifies common misconceptions. You can read the full article (in German) here.

Please contact the authors if you would like to receive an English translation.