Predatory Pricing and the Speed of Antitrust Enforcement

A common complaint is that in certain industries antitrust action against predation istoo slow to ensure that a true victim can survive until the antitrust process has beenconcluded. This paper discusses, in the context of two recent antitrust cases, the sources of delay in the antitrust process, and different policy reforms aimed at speeding up the process or otherwise protecting a true victim.     

The Determinants of State-Level Antitrust Activity

While there has been a considerable literature exploring the determinants of antitrust enforcement in the United States, these studies have been based either on aggregate federal enforcement data over time (exploring cyclical influences) or cross-industry studies, usually for a single year or aggregated over several years. What has never been investigated is the pattern of state-level antitrust litigation. This is somewhat surprising, as this has been a major activity of many state attorneys general. In this paper, we explain state antitrust activity across states, examining a number of the economic and political determinants that have been proposed in the literature.     

Introduction to the RIO Special Issue on Antitrust and the Platform Economy

The emergence of large technology platforms has raised fundamental questions about antitrust enforcement. These questions, which are the subject of this RIO special issue, are now challenging scholars and policy makers. The topics covered here include the role of economics and the consumer welfare standard in antitrust; lessons from historic antitrust cases; the role of big data in antitrust analysis; antitrust analysis of multi-sided markets; and the interplay between competition and privacy regulation.

     

企业集团引发的反垄断难题

本文从企业集团的界定、性质和域外管辖权三个角度提出了其所引发的反垄断难题。本文的主要观点是企业集团作为一种企业间组织。兼有“企业性”与“市场性”二重属性：企业集团的“二重性”是导致企业集团垄断行为隐蔽性和复杂性的根本原因；处理企业集团的反垄断问题需要准确判断企业集团行为属性。本文通过案例研究．分析了美国和欧盟处理企业集团反垄断难题时的一些典型做法：提出了处理企业集团反垄断难题的基本原则。     

Is Competition Such a Good Thing? Static Efficiency versus Dynamic Efficiency

Review of Industrial Organization - This paper addresses the rationale for antitrust legislation. It is a striking fact that the legitimacy of antitrust law has been taken for granted inthe United...     

Guess who came to dinner

This paper highlights the trends in antitrust enforcement for 1963–84. It is based upon an update by the author's of Posner's study and follows his methodology, format, and operational definitions. The specific data examined include number of antitrust cases instituted, the duration of cases, DOJ and FTC won-loss records, nature of cases, fines and imprisonment and violations alleged. Since 1890, the number of multiple cases instituted by the DOJ resulting from the investigation of a single conspiracy has increased. Consolidating cases to reflect this pattern shows the apparent increase in DOJ cases represent fewer conspiracies of more limited nature that are being prosecuted under the Reagan administration. It is an intense cultivation of a well-known terrain rather than exploration of new frontiers in antitrust. The Antitrust Penalties and Procedures Act of 1974 has increased the size of fines and the use of jail sentences. Structural relief is less frequent.     

Antitrust in the Reagan administration: A report from the Belly of the beast

This paper is a report on selected aspects of antitrust policy in the Reagan administration. It was written while the author was Director of the Bureau of Economics at the Federal Trade Commission. The topics covered include: merger guidelines, the general drift of antitrust policy, deregulatory initiatives, consumer protection policy, and the stronger emphasis on economic analysis in the conduct of antitrust policy. The conclusions drawn are not very sanguine in a normative sense. perhaps our solace lies in the positive study of why the antitrust bureaucracies behave as they do.     

Is Radio Advertising a Distinct Local Market? An Empirical Analysis

The recent relaxation of regulations limiting the ability of an entity to own multiple radio stations has led to a dramatic increase in ownership concentration in local radio markets. As a result, the Department of Justice has, on several occasions, required limited divestiture of multiple station owners. Implicit in the agency's action is that radio advertising constitutes an antitrust market. Using the framework established by the Merger Guidelines, this paper evaluates whether or not radio advertising is a distinct local market by estimating an own-price elasticity of demand for radio advertising. Our results support the assertion that radio advertising is an antitrust market.     

Exports and antitrust: Complements or substitutes?

Conflicting arguments have recently been voiced concerning the impact of antitrust statutes on the export performance of U.S. industries. On the one hand, opponents of vigorous enforcement have argued that antitrust constraints prevent firms from achieving efficiencies, thereby hampering competitiveness on world markets. On the other hand, proponents of antitrust have argued that vigorous enforcement tempers monopolistic pricing, thereby improving export performance. This paper presents an empirical test of these competing arguments. Our results indicate that Sherman Act Section 1 (price-fixing) enforcement has a positive effect on export shares, while Clayton Act Section 7 (merger) enforcement appears to have a negative effect.     

美国现行反垄断法对软件产业的适用性探析--以搭售和掠夺性定价为例

本文对软件产业的搭售与掠夺性定价行为进行了法律和经济分析。在美国现行的反垄断法体系中，这是属于典型的滥用市场势力的两种行为。但在软件产业却不能凭借传统标准简单地把这两种行为归结为垄断行为，而应从产业本身的特点和竞争环境出发谨慎对待。如一味运用美国现行的反垄断法惩罚软件产业正当的竞争行为，只会从更大程度上抑制竞争，损害消费者福利。在网络经济条件下，反垄断法应该顺应经济和技术的     

The NCAA and the Rule of Reason

This brief essay considers the use of antitrust’s rule of reason in assessing challenges to rule-making by the NCAA. In particular, it looks at the O’Bannon case, which involved challenges to NCAA rules that limit the compensation of student athletes under the NCAA rubric that protects the “amateur” status of collegiate athletes. Within that rubric, the Ninth Circuit got the right answer. That outcome leads to a broader question, however: Should the NCAA’s long held goal, frequently supported by the courts, of preserving athletic amateurism be jettisoned? Given the dual role that colleges play, that is a complex question, which raises issues that are not only commercial but also educational. More important for the purpose at hand, is whether jettisoning amateurism in NCAA athletics is a suitable task for an antitrust tribunal. This paper argues that antitrust law is not an appropriate vehicle for addressing that issue. This does not mean that antitrust has no role to play in policing athlete compensation in NCAA schools. But it does suggest that that role be limited to addressing restraints on trade that occur within the rubric of amateur status—at least until such time as a more competent body decides whether amateurism in collegiate athletics is worth preserving.     

The social loss from private monopoly and optimal antitrust enforcement

In this paper we argue that the welfare loss from monopoly equals deadweight loss plus expenditures by monopolists to defend and antitrust enforcers to attack their monopolies. A model of a profit-maximizing monopolist and a social loss-minimizing antitrust enforcer is developed. We find ambiguous effects of deadweight loss and the price of resources used by either party (in maintaining or attacking the monopoly) on the total welfare loss from monopoly. Monopoly profit has a positive but diminishing impact on monopoly welfare loss. Thus the entire monopoly profit will not be transformed into socially useless resource expenditure.     

Correlation,causality, and all that jazz: The inherent shortcomings of price tests for antitrust market delineation

A substantial economics literature has developed in which price data have been relied upon to delineate antitrust markets by empirically implementing definitions offered by classical economists. The forces driving these price tests are not the same as those that give rise to market power, and therefore these price tests are likely to reach erroneous conclusions if used to delineate antitrust relevant markets. The price tests should be used with great caution, if at all.     

Restraints of trade by durable good producers

Whether they face competition or not, durable good producers may have an incentive to impose vertical restraints on their customers in order to protect quasi-rents in the aftermarkets for maintenance and repair. In this paper, we show that these vertical restraints have little to do with the usual antitrust concerns regarding tying arrangements. Nonetheless, imposing such restraints involves antitrust risks. We examine these risks and the associated antitrust policy questions in light of the Supreme Court's recent Kodak decision. We also offer some suggestions for the appropriate antitrust policy.     

The 1984 justice department guidelines toward horizontal mergers

This paper examines the treatment of economic efficiency in the 1984 revision of the Department of Justice's antitrust Merger Guidelines. An overview of the evolution of the guidelines toward horizontal mergers is presented emphasizing three key areas where changes have occurred. A model is developed following O. Williamson framework is extended to link changes in market concentration (as measured by the Herfindahl-Hirschman Index) that result from a horizontal merger to changes in market power (as measured by price-cost margins). Finally, the cost reductions (economies) required to offset increases in market power are developed in a simulation model. The paper concludes with an application of the model to the LTV-Republic Steel merger.     

The antitrust implications of electronic business-to-business marketplaces

Electronic marketplaces (e-marketplaces) allow networks of buyers and sellers to conduct business online and to exchange information more efficiently using Internet technology. Despite the benefits that e-marketplaces potentially afford firms, concerns have been raised that these markets may damage competition and potentially violate antitrust laws. This study considers the antitrust legislation related to e-marketplaces and examines the possible antitrust concerns that they raise. Potentially anticompetitive features of e-marketplaces are examined and guidance for firm conduct when creating or participating in an e-marketplace is offered.     

After The Fall: Stock Price Movements and the Deterrent Effect of Antitrust Enforcement

In this paper, we utilize data on stock price movements of firms indicted on price-fixing charges to infer expectations of antitrust recidivism. Specifically, a return of the firm's (market-adjusted) asset value to its pre-indictment level in the post-indictment period is taken as evidence of stockholders' expectations of a return to collusive behavior. From these data, we are able to make direct inferences about the effectiveness of antitrust enforcement actions. Importantly, we find that the stock prices of 85 percent of the firms in our sample had regained 100 percent of their pre-indictment levels within one year of the antitrust action. Such widespread and rapid stock price appreciation casts doubt on the durability of thedeterrent effect of Section 1 enforcement.     

Strategic and deterrent pricing responses to antitrust investigations

This paper examines the issue of the effects of antitrust on pricing through two empirical studies. The first analyzes time series of prices in five industries involved in antitrust cases to determine whether the various stages of the antitrust process influenced pricing behavior. Some evidence of a ‘deterrent’ effect is found, with real prices lower than their pre-investigation level following the conclusion of the case; a major part of the pricing reaction occurs prior to the filing of formal charges. The second study provides additional evidence of the existence of such a ‘strategic’ reaction to the onset of investigation through an examination of prices in 23 industries investigated but not charged with price fixing.     

The Supreme Court and Beer Mergers: From <Emphasis Type="Italic">Pabst/Blatz</Emphasis> to the DOJ–FTC Merger Guidelines

The beer industry in the U.S. has undergone significant structural change in the post-WWII period. The industry also was the object of prominent antitrust challenges to horizontal mergers proposed during this time frame. This paper documents the trend of increasing seller concentration in the brewing industry and assesses the role that mergers played in this structural transformation. We also analyze the change in merger policy that has taken place since the Supreme Court originally addressed mergers in the beer industry as compared to current antitrust enforcement under the DOJ–FTC Merger Guidelines and recent judicial decisions.     

The cyclical behavior of the Department of Justice’s antitrust enforcement activity

We study the cyclical behavior of antitrust enforcement as measured by the number of cases initiated by the US Department of Justice. The key result is that antitrust case activity is countercyclical. This finding is robust across alternate indicators of economic activity which include stock prices, corporate profits and business cycles, and across different types of cases. The finding of countercyclical case activity does not appear to lend support to interest-group theories that predict greater regulatory protection towards producers during economic contractions. One interpretation of our result would be that antitrust violations tend to increase during economic downturns, leading to an increase in the number of cases initiated, the broad implication being that the Antitrust Division primarily acts as an antitrust law enforcement agency. Our results show that politics, as measured by the party of the President and the Republican versus Democrat composition of the House and Senate, does not have a clear impact on case activity. Finally, the number of cases initiated are significantly affected by the extent of funding.