Revitalizing Antitrust in Its Second Century: Essays on Legal, Economic, and Political Policy

Revitalizing Antitrust in Its Second Century: Essays on Legal, Economic, and Political Policy

Revitalizing Antitrust in Its Second Century: Essays on Legal, Economic, and Political Policy

Revitalizing Antitrust in Its Second Century: Essays on Legal, Economic, and Political Policy

Synopsis

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.

Excerpt

Joseph F. Brodley

For a generation a passionate debate has divided the antitrust community. Does antitrust law encompass non-economic goals, or is the law limited to purely economic objectives, most particularly economic efficiency? in recent years efficiency advocates have gained ascendancy, powerfully assisted by the perception that efficiency analysis in antitrust is scientific and rigorous, as contrasted with the softer values of a more inclusive approach that would encompass non-economic values. As a result, legal opinions and academic writings abound with discussions of economic efficiency and the related concept of consumer welfare. But while these terms are much used in antitrust writing, they are little analyzed. the startling result is that efficiency and consumer welfare have become the dominant terms of antitrust discourse without any clear consensus as to what they exactly mean.

In this chapter I attempt to develop a coherent meaning for efficiency and consumer welfare as applied to antitrust law, to draw out the policy implications that follow from such an articulation, and to examine whether an antitrust policy expressed purely in these terms can adequately achieve antitrust goals.

My analysis will suggest that contrary to current usage, efficiency and consumer welfare are not identical, but have distinct meanings, with sometimes conflicting policy implications. Focusing in turn on efficiency and consumer welfare, I argue that both concepts require clarification and more precise definition. Efficiency is not unitary, but breaks down into several differing types of efficiencies, some more vital to antitrust enforcement than others. Consumer welfare in turn is not the identical twin of efficiency, but a distinct concept that refers to the direct and immediate welfare of the consumers of a specific product. Thus, consumer welfare adds a distributional thrust to antitrust law.

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