information:extraction, structural:expansion
Output restriction rule

Williamson offers the output restriction rule to restrain dominant firms from engaging in predatory pricing. The rule stipulates that upon the entry of a new firm in a market, a dominant firm cannot abuse their position by increasing their output above the pre-entry level. A prevention period of 12 to 18 months should be adequate for new entrants to establish a market identity and understand economies of scale while disincentivizing dominant firms from holding excess capacity. Williamson suggests that the output restriction rule possesses greater welfare properties than the short-run marginal cost rule or short-run average cost rule.