Framing the Chicago School of Antitrust Analysis PDF Download

Author: Herbert Hovenkamp
Publisher:
ISBN:
Category :
Languages : en
Pages : 38

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Book Description
The Chicago School of antitrust has benefitted from a great deal of law office history, written by admiring advocates rather than more dispassionate observers. This essay attempts a more neutral stance, looking at the ideology, political impulses, and economics that produced the Chicago School of antitrust policy and that account for its durability. The origins of the Chicago School lie in a strong commitment to libertarianism and nonintervention. Economic models of perfect competition best suited these goals. The early strength of the Chicago School of antitrust was that it provided simple, convincing answers to everything that was wrong with antitrust policy in the 1960s, when antitrust was characterized by over-enforcement, poor quality economics or none at all, and many internal contradictions.The Chicago School's greatest weakness is that it did not keep up. Its leading advocates either spurned or ignored important developments in economics that gave a better accounting of an economy that was increasingly characterized by significant product differentiation, rapid innovation, networking, and strategic behavior. The Chicago School's initial claim was that newer models of the economy lacked testability. That argument lost its credibility, however, as industrial economics experienced an empirical renaissance, nearly all of it based on various models of imperfect competition. Students getting PhDs in economics increasingly abandoned perfect competition as a useful starting point. What kept Chicago alive was the financial support of firms and others who stood to profit from less intervention. Properly designed antitrust enforcement is a public good. Its beneficiaries -- consumers -- are individually small, numerous, scattered, and diverse. Those who stand to profit from nonintervention were fewer in number, individually much more powerful, and much more united in their message. As a result, the Chicago School went from being a model of enlightened economic policy to a powerful tool of regulatory capture.

Author: I. Schmidt
Publisher: Springer Science & Business Media
ISBN: 9400925670
Category : Business & Economics
Languages : en
Pages : 145

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Book Description
The publication of this clinically analytical and trenchantly insightful volume is felicitously timed. By fortuitous coincidence, it comes at a time when the Chicago School enjoys a high-water mark of acceptance in U.S. legal circles, and at a time when the U.S. merger movement of the 1980s is cresting. It provides a welcome warning against the dangers of translating abstract theories, based on highly restrictive (and unrealistic) assumptions, into facile public policy recommendations. As such the Schmidt/Rittaler study serves as a needed antidote to the currently fashionable predilection to confuse ideology with science. In the Chicago lexicon, the only appropriate policy toward business is a policy of untrammeled laissez-faire. Because there are no market imperfec tions (other than government-created or trade-union-generated monopolies), the market can be trusted to regulate economic activity, inexorably meting out appropriate rewards and punishments. In this ideal world, corporate size and power can be safely ignored. After all, corporations become big only only because they are efficient, only because they are productive, only because they have served consumers better than their rivals, and only because no newcomers are good enough to challenge their dominance. Once an industrial giant becomes lethargic and no longer bestows its productive beneficence on society, it will inevitably wither and eventually die. This is the "natural law" that governs economic life. It demands obedience to its rules. It tolerates no interference by the state.

Author: Robert Pitofsky
Publisher: Oxford University Press
ISBN: 0195372824
Category : Business & Economics
Languages : en
Pages : 324

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Book Description
The essays collected in this book concern the rise and recent fall of American antitrust. Of the 15 essays, almost all express a deep concern that conservative economic analysis is leading judges and enforcement officials toward an approach that will ultimately harm consumer welfare.

Author: Robert Pitofsky
Publisher: Oxford University Press
ISBN: 0199888248
Category : Law
Languages : en
Pages : 328

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Book Description
How the Chicago School Overshot the Mark is about the rise and recent fall of American antitrust. It is a collection of 15 essays, almost all expressing a deep concern that conservative economic analysis is leading judges and enforcement officials toward an approach that will ultimately harm consumer welfare. For the past 40 years or so, U.S. antitrust has been dominated intellectually by an unusually conservative style of economic analysis. Its advocates, often referred to as "The Chicago School," argue that the free market (better than any unelected band of regulators) can do a better job of achieving efficiency and encouraging innovation than intrusive regulation. The cutting edge of Chicago School doctrine originated in academia and was popularized in books by brilliant and innovative law professors like Robert Bork and Richard Posner. Oddly, a response to that kind of conservative doctrine may be put together through collections of scores of articles but until now cannot be found in any one book. This collection of essays is designed in part to remedy that situation. The chapters in this book were written by academics, former law enforcers, private sector defense lawyers, Republicans and Democrats, representatives of the left, right and center. Virtually all agree that antitrust enforcement today is better as a result of conservative analysis, but virtually all also agree that there have been examples of extreme interpretations and misinterpretations of conservative economic theory that have led American antitrust in the wrong direction. The problem is not with conservative economic analysis but with those portions of that analysis that have "overshot the mark" producing an enforcement approach that is exceptionally generous to the private sector. If the scores of practices that traditionally have been regarded as anticompetitive are ignored, or not subjected to vigorous enforcement, prices will be higher, quality of products lower, and innovation diminished. In the end consumers will pay.

Author: Jan B. Rittaler
Publisher: Peter Lang Gmbh, Internationaler Verlag Der Wissenschaften
ISBN:
Category : Business & Economics
Languages : en
Pages : 434

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Book Description
After roughly 15 years of merger control application in the Federal Republic of Germany a reassessment of the significance of this instrument of antitrust policy seems necessary. This is particularly so in view of the reorientation of merger control policy in the United States which has been - in its original version - the model for the German merger control system. Concerning merger control, the reorientation is characterized by the notion that the structure-conduct-performance paradigm which has dominated U.S. antitrust for a quarter of a century is imprecise or even incorrect and «that bigness in business does not necessarily mean badness.» This makes the fundamental question arise of whether the German merger control system is still up to date in terms of the underlying market theory and of whether the German Act Against Restraints of Competition needs a reorientation towards aspects of market conduct and performance instead of market structure by means of a Fifth Amendment.

Author: Timothy J. Muris
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
This symposium began with a call for papers “re-assessing the validity of the Chicago School's assumptions about competition and considering whether a more aggressive approach to antitrust enforcement is now warranted.” That framing uncritically accepts the premises of antitrust's new populist movement: first, that “the Chicago School” marked an abrupt break from prior academic analysis of antitrust law, and, second, that its adherents shared a common positive agenda fundamentally at odds with robust antitrust enforcement. Both of those premises are false. The Chicago School represented a logical continuation of the antitrust analysis developed over the preceding decades, and its members shared no positive doctrinal agenda. Instead, they shared a commitment only to promoting consumer interests by means of rigorous economics. Of course, that commitment influenced how the economics profession and antitrust policymakers thought, and progressive “post-Chicago” scholarship today shares the same commitment to consumer welfare and economic rigor. Post-Chicago scholarship thus has far more in common with Chicago School scholarship of the 1960s and 1970s than with today's populist movement, which abandons any coherent framework altogether.

Author: Antonio Cucinotta
Publisher: Edward Elgar Publishing
ISBN: 9781843767039
Category : Law
Languages : en
Pages : 364

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Book Description
This work offers a critical evaluation of the Chicago approach to antitrust. The authors discuss the economic foundations of competition policy and the different ways in which both American and European competition law does - or does not - take account of economic insights.

Author: Anu Bradford
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
Beginning in the 1950s, a group of scholars primarily associated with the University of Chicago began to challenge many of the fundamental tenants of antitrust law. This movement, which became known as the Chicago School of Antitrust Analysis, profoundly altered the course of American antitrust scholarship, regulation, and enforcement. What is not known, however, is the degree to which Chicago School ideas influenced the antitrust regimes of other countries. By leveraging new datasets on antitrust laws and enforcement around the world, we empirically explore whether ideas embraced by the Chicago School diffused internationally. Our analysis illustrates that many ideas explicitly rejected by the Chicago School--such as using antitrust law to promote goals beyond efficiency or regulate unilateral conduct--are common features of antitrust regimes in other countries. We also provide suggestive evidence that the influence of the antitrust revolution launched by the Chicago School has been more limited outside of the United States.

Author: Mark Glick
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
The Chicago School of antitrust claims that it made a major contribution beginning in the late 1970s to making antitrust policy coherent and “scientific” by introducing basic economic concepts. It both advanced the Consumer Welfare Standard (a normative economic theory to segregate legitimate economic competition goals from “value judgments”) and a basic positive microeconomic theory to show how much of the conduct previously considered anticompetitive was justified on “efficiency” grounds. Their contributions had a major impact on the federal judiciary in the United States and the antitrust enforcement agencies as well, who spread Consumer Welfare throughout the globe. The Post-Chicago School economists have not challenged the Consumer Welfare Standard. Instead, the Post Chicago School has asserted that Consumer Welfare Standard is redeemable--correctable for many of the overstatements and conservative political conclusions of the Chicago School. Proponents of the Post Chicago School are fond of advancing the narrative that, in the late 1980s and during the 1990s, major advancements occurred in industrial organization economics: Many of the earlier Chicago School conclusions required assumptions that were not evident from the Chicago School economists and often not typical of the factual situations under scrutiny in antitrust cases. In the last decade a third school of antitrust scholars, the New Brandeisians, perhaps drawing from literature ignored during these waves of economic theory, have made major headway in antitrust circles.The “New Brandeisians” accept the advances of the Post Chicago Economists, but challenge Post Chicago scholars' devotion to the Consumer Welfare Standard, their understanding of antitrust history, and instead advocate that competition policy can address the traditional antitrust goals of political democracy and support for small business. They further claim that antitrust enforcement should be used to protect labor and to address inequality when it is being exacerbated by a traditional antitrust violation.Post Chicago scholars have not been embracing of the New Brandeisians. Several papers by Post Chicago scholars have emphasized that the New Brandeisians do not sufficiently adopt economic theory. Post Chicago scholars claim that, on economic grounds, they are the clear winners of this competition between competing analytical approaches because only they are faithful to the latest developments in industrial organization. For example, in a recent paper Jonathan Baker, contrasting himself with the New Brandeisians states that “By contrast, post-Chicagoans embrace economics. Centrist reformers see economic analysis and economic evidence as essential for making the case for stronger antitrust rules and enforcement...”In this paper, we claim that economic theory--not just the sub discipline of industrial organization-- supports the New Brandeisians. Specifically, modern welfare economics warrants the abandonment of the Consumer Welfare Standard as antiquated and deeply and irrevocably flawed.Moreover, economic history provides empirical evidence that the goals of the New Brandeisians will benefit the economy as a whole. While Post-Chicago claims about the limitations of the Chicago School are largely accurate, they limit economic theory to industrial organization--applied microeconomics. Economics as a discipline is much broader and richer than these Consumer Welfare Standard advocates let on. By ignoring the larger discipline in economics and the advances that have taken place, Antitrust discourse has been impoverished. The effect has been to cast the New Brandeisians as the outliers in terms of economic understanding, when it is the case that they are the only school to have the bulk of economics on their side.

Author: Robert Larner
Publisher: Praeger
ISBN:
Category : Business & Economics
Languages : en
Pages : 264

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Book Description
As the economists and lawyers contributing to this volume demonstrate, an important element of the Reagan Revolution has been a fundamental shift in antitrust policy and enforcement away from the focus on market structure during the 1960s and early 1970s toward a greater emphasis on the effects of business conduct on economic efficiency and consumer welfare. This shift, caused both by a marked change in the political climate and changes in the thinking and research output of economists, has had an enormous impact on the volume and substance of antitrust activity during the 1980s. The articles collected here--each written especially for this volume--assess these changes in antitrust activity in key policy areas: mergers, vertical restraints, monopoly, and strategic behavior. The authors examine particularly the impact of the change in antitrust enforcement and policy on social welfare. They point out where changes have been beneficial, evaluate whether further changes in policy or law are desirable, and probe unresolved issues, such as whether current policy pays too little attention to the possible strategic or anticompetitive aspects of some forms of business conduct. Taken together, these essays offer a multifaceted explanation of the ways in which economics has contributed to changes in antitrust policy and law. By providing a more thorough understanding of developments in industrial economics during the last 30 years, the authors also provide lawyers, economists, business executives, and students of business administration with new insights into possible future trends in antitrust policy and law--and their impact on the structure of American businesses and markets.