institutions, including academic commentators, continue to refine our guesses
about the way the world works and to formulate tentative presumptions to guide
actual antitrust decisions. If we can be realistic in identifying competition, especially foreign competition, where it exists, and in recognizing that productivity,
efficiency, and innovation are not inexorable but have to be worked at, then the
Sherman Act may well be around for another century.
Of course, only the most romantic trustbuster would suppose that existing
antitrust institutions always suffice. Maybe some other power will work better or
existing antitrust tribunals will fail to see or weigh an important public service
that could result from an otherwise illegal arrangement. Congress, with all the
other demands on its attention, can not be relied on to respond to the needs of a
particular market. We may therefore need to create some kind of power to
exempt an arrangement from antitrust liability. I say that with some hesitation,
for agencies with such power have generally seemed, in my view, too generous in
exercising it, and even an antitrust agency can be overruled by its masters. Still, I
believe we need to give more thought to improving the business review procedures
of the Department of Justice and the Federal Trade Commission and perhaps
empowering them to grant a full exemption in selected circumstances.
Even so, our presumption should continue to favor competition rather than
its limitation. After all, that is the strength of the Sherman Act and it has served
See, generally, S. Breyer, Regulation and its Reform ( 1982).
Compare, e.g., H. Demsetz, "Why Regulate Utilities?" J.L. & Econ. 11 ( 1968): 55,
with O. Williamson, "Franchise Bidding for Natural Monopolies--In General and
with Respect to CATV", Bell J. Econ. 7 ( 1976):73.
E.g., respectively, Sunkist Growers v. Winckler & Smith Citrus Prods. Co., 370 U.S. 19 ( 1962); Parker v. Brown, 317 U.S. 341 ( 1943); United States v. Borden Co., 308
U.S. 188 ( 1939).
See, e.g., F. Machlup, An Economic Review of the Patent System, Study No. 15 of
the Subcomm. on Patents, Trademarks, & Copyrights of the Sen. Judiciary Comm.,
85 Cong., 2d sess., Committee Print ( 1958); A. Kahn, "The Role of Patents," in
J. P. Miller
, ed., Competition, Cartels and Their Regulation ( 1962); R. Nelson, "The Simple Economics of Basic Scientific Research," J. Pol. Econ. 67 ( 1959):297.
J. Schumpeter, Capitalism, Socialism, and Democracy, ( 1942), chs. 7-8.
A sampling of the literature will be found in F. M. Scherer and
D. Ross, Industrial
Market Structure and Economic Performance ( 3d ed. 1990), ch. 17. See also P. Areeda
D. Turner, 2 Antitrust Law ¶407 ( 1978).
United States v. AT&T, 552 F. Supp. 131 (D.D.C. 1982), aff'd mem. sub nom. Maryland v. United States, 460 U.S. 1001 ( 1983).
Business Electronics Corp. v. Sharp Electronics Corp., 108 S.Ct. 1515 ( 1988).
Hoover v. Ronwin, 466 U.S. 588 ( 1984).
Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585 ( 1985).
E.g., Brown Shoe Co. v. United States, 370 U.S. 294 ( 1962).
See P. Areeda &
D. Turner, 3 Antitrust Law ¶523b6 and ¶523.1-2 ( 1978 & Supp. 1991).