Antitrust, Innovation, and Competitiveness

By Thomas M. Jorde; David J. Teece | Go to book overview

This list of conservation devices is not exhaustive. The "antitrust injury" rule, the doctrine of Illinois Brick, the courts' refusal to award contribution among antitrust offenders, these and more cut down on litigation and error costs. Let me mention just one more that is used in other industrial nations (and in many bodies of our law, such as securities regulation) but rare in antitrust law in the United States: administrative safe harbors.

Information becomes a larger fraction of the cost of production as time passes. The next generations of aircraft, computers, HDTV, and so on, will be made not of steel or silicon or sweat and tears. They will be "assembled" principally from information--from knowledge. No firm has the right incentive to acquire knowledge, because no firm can appropriate all of the benefits of what it knows. To make matters worse, attempts to appropriate the benefits lead to inefficiently little use of products based on the latest knowledge, for the marginal cost of using what is known is zero. Firms can overcome some of the problems by cooperating, sharing both costs and benefits. But as soon as they start cooperating, they expose themselves to treble damages.

Professors Jorde and Teece emphasize in their contribution to this symposium that antitrust law must find a way to accommodate doctrine developed in a world in which production meant riveting steel plates together to the increasing need for cooperation in information-intensive markets (see Chapter 3). This accommodation inevitably will come through safe harbors, similar to those that now apply to research and development joint ventures or to newspaper joint operating agreements. Administrators can formulate rules of nationwide application; a court may speak only for itself.

Antitrust is today a body of common law, always in evolution, subject to different interpretation in thirteen federal circuits and the courts of fifty states. A single practice may be challenged in a dozen forums, by private plaintiffs and state attorneys general, each convinced that litigation advances the nation's welfare. No matter how well-intentioned the plaintiffs, no matter how astute the judges, the process of common law litigation is one of uncertainty. Until the last case is over, no one knows whether the practice can survive--indeed, no one knows whether its practitioners can survive (given the prospect of stupendous damages). Common law antitrust litigation is high-risk litigation, high-delay litigation. By the time the other shoe drops, the moment for this generation of products is past. Some other nation, with a legal system able to give quick and binding answers to tough questions, will take the baton. Antitrust must recognize this and adjust, or a system designed to promote consumers' welfare will inflict the wound of Amfortas.


NOTES

This paper was completed in April 1989 and was revised in only minor ways thereafter, principally by adding a few citations to recent decisions.

1.
See, generally, Frank H. Easterbrook, "Workable Antitrust Policy", Michigan Law Review 84 ( 1986): 1696, and "The Limits of Antitrust", Texas Law Review 63 ( 1984): 1.

-132-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this book

This book has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this book

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited page

Bookmark this page
Antitrust, Innovation, and Competitiveness
Table of contents

Table of contents

  • Title Page iii
  • Preface vii
  • Notes viii
  • Contents ix
  • Contributors xi
  • 1 - Introduction 3
  • Notes 25
  • References 27
  • 2 - Antitrust Law as Industrial Policy: Should Judges and Juries Make It? 29
  • Notes 45
  • 3 - Innovation, Cooperation, and Antitrust 47
  • Notes 63
  • References 68
  • Appendix: National Cooperative Research and Commercialization Act (ncrca) 71
  • 4 - Antitrust: Source of Dynamic and Static Inefficiencies? 82
  • Notes 95
  • References 96
  • 5 - Agreements Between Competitors 98
  • Notes 114
  • 6 - Ignorance and Antithrust 119
  • Notes 132
  • 7 - Antitrust Lenses and the Uses of Transaction Cost Economics Reasoning 137
  • Notes 158
  • References 161
  • 8 - Monopoly Conduct, Especially Leveraging Power from One Product or Market to Another 165
  • 9 - Market Structure and Technical Advance: The Role of Patent Scope Decisions 185
  • Notes 219
  • 10 - Conclusion 233
  • Index 235
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen
/ 246

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.