Antitrust and the Economy

In this provocative new work, a distinguished group of policymakers, legal scholars, and economists challenge the prevailing view that antitrust legislation is no longer relevant, arguing instead that antitrust, progressively construed and adapted to today's economic realties, remains the most promising national economic policy for this country. Their papers address a range of topics, including the impact of underenforcement of antitrust law in the 1980s, the implications of global markets and competition, theoretical advances, and the future of antitrust.

This revisionist analysis of antitrust history and policy argues that a practical government policy, not a doctrinaire and unrealistic set of rules, is necessary to preserve competition. Economic theories, such as the "Chicago school," that promulgate unfettered competition and identify consumer welfare as the primary objective of antitrust policy, far from being scientifically valid, are an intellectual scandal. Antitrust policy in this country has been flawed from the outset by historical misperceptions, market malfunctions and misguided teaching of economic theory. The author proposes that we look to Europe as a model for effective antitrust policy and legislation.

Using perspectives from American history, economic theory, and legal analysis, the Garveys take an interdisciplinary approach to U.S. public law and policy--antitrust and regulation--and develop the essential unity of the two major fields based on a clearly written summary of pertinent microeconomic principles. They establish that economic growth has been a primary goal of U.S. public policy throughout the nation's history. A critical survey of neopopulism and neoclassicism, the two major post-war impulses in public economic law, is also provided.

This book examines the legislative history and the political economy of the Sherman Antitrust Act--the main federal statute that regulates economic activity in the United States. Tracing the evolution of the antitrust movement in the United States since 1890, this collection of essays examines the role of government in regulating markets, and the balance it and its critics seek between the goal of limited government and the protection of free, open and competitive markets, With markets today being more international in nature and the world economy being globalized, Americans need to rethink how laws have defined markets and the implications for international transactions. Given the recent changes in Europe, this book has a significant contribution to make to the intellectual understanding of antitrust laws impact on American business here and abroad, on the European Economic Community (EEC) as it creates a single market by 1992, and on Eastern Europe as it moves to a market economy.

Protecting economic competition has become a major objective of government in Western Europe, and competition law has become a central part of economic and legal experience. The competition law of the European Union has played a key role in the success of European integration during the last four decades, and it is likely to do so in the future. In recent years, national competition laws have also become increasingly important, often creating tensions between national-level and European-level regulation. Yet, despite its importance, images of European experience with competition law often remain vague and are sometimes dangerously distorted. This book examines European experience in protecting competition, analysing its dynamics, revealing its importance and highlighting the political and economic issues it raises.

This book explores how the U.S. antitrust laws, especially the Sherman Antitrust Act, have affected the ways in which U.S. corporations can form alliances to compete in world markets. The editors start from the premise that current antitrust laws unwisely restrain innovation by inhibiting desirable pro-competitive communication and cooperation between firms. This results in an impediment to the performance of U.S. firms competing in industries experiencing rapid technological change. Not all of the contributors agree with the editors about the degree to which the antitrust laws do indeed inhibit U.S. industry. Thus, the book represents a variety of views on a topic of increasing importance. Contributors include Phillip Areeda, William J. Baumol, Ann I. Jones, Robert P. Merges, Richard R. Nelson, Janusz A. Ordover, Thomas M. Jorde, Richard Schmalensee, Lawrence A. Sullivan, David M. Teece, Oliver E. Williamson, and Judge Frank H. Easterbrook.

This is the first study to apply the interest-group model of regulation to the study of antitrust law and policy. The application of this model enables the author to both identify important trends in the antitrust arena and demonstrate which groups have benefited most from antitrust legislation. Divided into three sections, the first provides an overview of antitrust law and policy, the second explores the various private interests that impinge on antitrust policy, and finally, Shugart examines the political economy of antitrust. His analysis clearly shows that the antitrust legislation of the last few decades has tended to benefit well organized private interest groups more than consumers.

Economic theorizing suggests that firms can acquire and maintain market dominance in a number of ways. Some economists argue that firms attain dominance only by being relatively more efficient than their rivals and retain leadership only by staying more efficient than their rivals. Others argue that efficiency is not the only source of dominance and that leaders can retain ascendancy even if they are inefficient. This book attempts to sort out the relevant points by exploring market dominance as it has been experienced by firms in ten different industries. The results suggest that both schools make valid points. While firms generally used efficient strategies to reach preeminence, some chose predatory policies to gain market share. While all used assorted efficient strategies to maintain their dominance, many remained dominant long after their efficiencies had evaporated.