Antitrust Policy and Interest-Group Politics

By William F. Shughart II | Go to book overview

ness of the remedies imposed in merger cases. 63 Drawing on a theory of government enterprise, 64 which suggests that "visible" output will be favored over "invisible" output, Rogowsky argues that, because the personal reward structure facing them pushes the government's antitrust attorneys in the direction of generating new complaints and trying new cases, remedy tends to become an incidental aspect of the law enforcement process. Once the liability phase of an antitrust proceeding has been "won," staff attorneys and upper-level bureau managers have an incentive to resolve the relief issue quickly in order to move on to other investigations that hold the promise of going to trial. A "weak" remedy may therefore be proposed by the prosecutors (or accepted when offered by the defendant) simply to get the negotiations over with quickly and a final judgment entered closing out the case. Alternatively, Rogowsky suggests that remedies tend to be ineffective because the allegations made in many of the government's complaints tend to be weak or meritless. Insofar as cases are selected for prosecution not because of their social payoff but because of their potential for being settled expeditiously either in trial or through negotiations with the defendant that lead to a consent order, weak allegations can be disposed of quickly with weak remedies.

Taken as a group, these few studies of organizational behavior point to the conclusion that the antitrust bureaucracy does not select cases to prosecute on the basis of their potential net benefit to society. Instead, the managers and staff of the Antitrust Division and the Federal Trade Commission use the discretion at their disposal partly to further their own private interests rather than those of the public at large.


NOTES
1.
See A. D. Neale and D. G. Goyder, The Antitrust Laws of the U.S.A.: A Study of Competition Enforced by Law, 3d ed. ( Cambridge, UK: Cambridge University Press, 1980), p. 373; and George J. Stigler, "The Economists and the Problem of Monopoly," American Economic Review Papers and Proceedings 72 ( May 1982), p. 10.
2.
The Antitrust Division did not become a separate line item in the Department of Justice budget until 1932.
3.
Joseph C. Gallo, Joseph L. Craycraft, and Steven C. Bush, "Guess Who Came to Dinner: An Empirical Study of Federal Antitrust Enforcement for the Period 1963-1984," Review of Industrial Organization 2 ( 1985), p. 128.
4.
Ibid., p. 126.
5.
Richard A. Posner, "A Statistical Study of Antitrust Enforcement," Journal of Law and Economics 13 ( October 1970), p. 398.
6.
Ibid.
7.
Gallo Craycraft, and Bush, "Guess Who Came to Dinner," p. 114.

-100-

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Antitrust Policy and Interest-Group Politics
Table of contents

Table of contents

  • Recent Titles from Quorum Books ii
  • Title Page iii
  • Contents vii
  • Figures ix
  • Tables xi
  • Foreword xiii
  • Preface xvii
  • Introduction 1
  • Notes 8
  • Part I Normative and Positive Theories of Antitrust 9
  • 2: The Interest-Group Theory of Government 36
  • Part II Private Interests at Work 51
  • 3: Business Enterprise 53
  • 4 - The Antitrust Bureaucracy 100
  • 5: The Congress 104
  • 6: The Judiciary 121
  • 7: The Private Antitrust Bar 138
  • Part III The Political Economy of Antitrust 155
  • 8: Using Antitrust to Subvert Competition 157
  • 9: Reform in the Realm of Interest-Group Politics 177
  • Select Bibliography 197
  • Index 203
  • About the Author 209
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