scholarly journals The Influence of Economic Theories and Schools on Competition Law in terms of Vertical Agreements

2018 ◽  
Vol 11 (18) ◽  
pp. 153-180
Author(s):  
Zbigniew Jurczyk
Keyword(s):  
Competition Policy ◽  
Evaluation Criteria ◽  
Competition Law ◽  
Chicago School ◽  
Antitrust Law ◽  
Competitive Effects ◽  
Economic Theories ◽  
The Past ◽  
Antitrust Analysis ◽  
Harvard School

The paper aims at showing the influence and the views espoused by economic theories and schools of economics on competition policy embedded in antitrust law and conducted by competition authorities in the field of vertical agreements. The scope of the paper demonstrates how substantially the economization of antitrust law has changed the assessment as to the harmfulness of vertical agreements. The analysis of economic aspects of vertical agreements in antitrust analysis allows one to reveal their pro-competitive effects and benefits, with the consumer being their beneficiary. The basic instrument of the said economization is that antitrust bodies draw on specific economic models and theories that can be employed in their practice. Within the scope of the paper, the author synthesizes the role and influence of those models and schools of economics on the application of competition law in the context of vertical agreements. In presenting, one after another, the theories and schools of economics which used to, or are still dealing with competition policy the author emphasises that in its nature this impact was more or less direct. Some of them remain at the level of general principals and axiology of competition policy, while others, in contrast, delineate concrete evaluation criteria and show how the application of those criteria changes the picture of anti-competitive practices; in other words, why vertical agreements, which in the past used to be considered to restrain competition, are no longer perceived as such. The paper presents the models and recommendations of neoclassical economics, the Harvard School, the Chicago and Post-Chicago School, the ordoliberal school, the Austrian and neoAustrian school as well as the transaction cost theory.

scholarly journals When Economics Met Antitrust: The Second Chicago School and the Economization of Antitrust Law

2015 ◽  
Vol 16 (2) ◽  
pp. 313-353 ◽  
Author(s):  
PATRICE BOUGETTE ◽  
MARC DESCHAMPS ◽  
FRÉDÉRIC MARTY
Keyword(s):  
United States ◽  
New Deal ◽  
Competition Policy ◽  
Economic History ◽  
Competition Law ◽  
Chicago School ◽  
The United States ◽  
Antitrust Law ◽  
Antitrust Enforcement ◽  
Minor Influence

In this article, the authors interrogate legal and economic history to analyze the process by which the Chicago School of Antitrust emerged in the 1950s and became dominant in the United States. They show that the extent to which economic objectives and theoretical views shaped the inception of antitrust law. After establishing the minor influence of economics in the promulgation of U.S. competition law, they highlight U.S. economists’ caution toward antitrust until the Second New Deal and analyze the process by which the Chicago School developed a general and coherent framework for competition policy. They rely mainly on the seminal and programmatic work of Director and Levi (1956) and trace how this theoretical paradigm became collective—that is, the “economization” process in U.S. antitrust. Finally, the authors discuss the implications and possible pitfalls of such a conversion to economics-led antitrust enforcement.

The Goals of Competition Law

2020 ◽  
pp. 58-89
Author(s):  
Rex Ahdar
Keyword(s):  
New Zealand ◽  
Competition Law ◽  
Chicago School ◽  
Labour Government ◽  
Business Interests ◽  
Michael Porter ◽  
Workable Competition ◽  
Term Benefit ◽  
Harvard School

The Commerce Act 1986 expressly states its object is to promote “effective or workable competition.” This traditional Harvard School approach has been consistently assailed by big business interests in New Zealand, assisted by a phalanx of “down-under” Chicago School economists and lawyers. Chicagoans have had minor successes in terms of amendments to the principal Act, and some quite notable court victories, but the glittering prize, the overall objective of the Act, has remained unchanged. Chicago won several battles, but lost the war. A major amendment to the Act in 2001, promoted by a Labour government, recast its object to state that its purpose was “to promote competition in markets for the long-term benefit of consumers within New Zealand.” After a quiet period where nothing seemed to have changed, the most recent signs are that a mild preference for consumers is appearing. The chapter also examines the international competitiveness arguments of Michael Porter.

scholarly journals Towards a Broader View of Competition Policy

2018 ◽  
Author(s):  
Joseph E Stiglitz
Keyword(s):  
Developing Countries ◽  
Emerging Markets ◽  
Market Economy ◽  
Competition Policy ◽  
Legal Framework ◽  
Antitrust Law ◽  
The Past ◽  
Economics Profession ◽  
Economics And Politics

For over 100 years, competition policy has been a central part of a market economy’s legal framework. Over the past third of a century, however, the scope and effectiveness of competition policy has been narrowed, under the influence of certain ideas about the functioning of the market economy—ideas which have subsequently been widely discredited within the economics profession, but whose influence within antitrust law remains significant. This chapter argues that, to the contrary, changes in our economy and our understandings of the interplay between economics and politics necessitates a broader reach for competition policy than envisaged by the original advocates of antitrust law, and that this is especially so in developing countries and emerging markets.

The Complexity of Conversing About Entrepreneurship, Innovation, and Antitrust

2016 ◽  
Vol 61 (4) ◽  
pp. 494-497
Author(s):  
Peter C. Carstensen
Keyword(s):  
Public Interest ◽  
Competition Policy ◽  
Competition Law ◽  
Antitrust Law ◽  
The Public ◽  
Law And Policy ◽  
The Many ◽  
The Relationship ◽  
Innovation And Entrepreneurship

The relationship between law including competition policy and the goal of advancing innovation and entrepreneurship is complex. Bert Foer’s chapter identifies the many ways that competition law and policy directly and indirectly can affect positively or negatively the advancement of that goal. The comment seeks to highlight that range and complexity by using the categories from the traditional I-O Paradigm to show where and how antitrust law and policies it seeks to advance can be used to shape the conditions, structure, and conduct in markets to facilitate outcomes that will advance the public interest in innovation and entrepreneurship.

scholarly journals Economic and Legal Features of Digital Markets

2019 ◽  
Vol 10 (2) ◽  
pp. 173-183
Author(s):  
Rastislav Funta
Keyword(s):  
Social Networks ◽  
Economic Activity ◽  
Competition Policy ◽  
Business Models ◽  
Competition Law ◽  
Digital Transformation ◽  
The Other ◽  
Policy Statements ◽  
New Challenges ◽  
Antitrust Analysis

Abstract Digitization has changed economic activity in many ways. While digitization has contributed to a very dynamic development of markets and competition, concerns are also being expressed about powerful positions of some companies. The digital transformation poses new challenges for companies, consumers, politics and society. Competition policy is also required to address these developments and to adapt existing competition law, if necessary. The following analysis of digital markets showed that it is not possible, in general, to make concrete competition policy statements or even to give detailed recommendations for the antitrust analysis. The aspects are to be considered separately and in detail when examining search engines, social networks, trading platforms and other business models. On the other hand, data (and data analysis) should stand in the centre of competition law analysis due to their importance for the economic success of digital market companies.

The Causes and Consequences of the Neo-Brandeisian Antitrust Movement in the United States

2021 ◽  
Vol 19 (4) ◽  
pp. 460-486
Author(s):  
Andre Fiebig ◽  
David Gerber
Keyword(s):  
Economic Theory ◽  
Organization Theory ◽  
Chicago School ◽  
The United States ◽  
Antitrust Law ◽  
Power Structures ◽  
Antitrust Analysis ◽  
Value Neutrality ◽  
School Movement ◽  
The U.S

Abstract The recent appointments of Timothy Wu as Special Assistant to the U.S. President for Technology and Competition Policy and Lina Khan, a member of the U.S. Federal Trade Commission, two prominent advocates for a fundamental shift in U.S. antitrust policy, and the introduction of federal and state legislation to change how antitrust is applied signal a realistic possibility of a fundamental change of direction in the course of U.S. antitrust. The shift advocated by these self-described “Brandeisians” goes beyond the reform proposals advocated by the Post-Chicago School movement. Whereas the Post-Chicago School movement, which was based primarily on industrial organization theory, advocated for change while recognizing the primacy of economic theory in the application of antitrust law, the Neo-Brandeisians argue that economic considerations should only be part of the substantive antitrust analysis and not necessarily the determinative factor. For many Europeans, and in particular Germans familiar with legal history, the ideas advanced by the Neo-Brandeisians will be familiar. Louis Brandeis, whose writings and opinions serve as the intellectual compass of the Neo-Brandeisians, was himself influenced by the Freirechtsbewegung and their skepticism of a wertfreie jurisprudence. Borrowing from post-modernist philosophy, the Neo-Brandeisians recognize that the dominant legal doctrines reflect the prevailing power structures in society. In their view, the fact that U.S. antitrust law relies heavily on economic theory does not allow it to claim value neutrality. The more radical members of this movement consequently argue that other values beyond economics should be considered in the application of U.S. antitrust law by the courts and antitrust agencies. In this article we attempt to introduce this movement to a European audience and assess its possible impact on the direction of U.S. antitrust.

Competition Policy and Price Fixing

2013 ◽  
Author(s):  
Louis Kaplow
Keyword(s):  
Competition Policy ◽  
Competition Law ◽  
Direct Approach ◽  
Social Harm ◽  
Systematic Analysis ◽  
Oligopoly Theory ◽  
Different Types ◽  
Error Costs ◽  
Benefits And Costs ◽  
Desirable Behavior

Throughout the world, the rule against price fixing is competition law's most important and least controversial prohibition. Yet there is far less consensus than meets the eye on what constitutes price fixing, and prevalent understandings conflict with the teachings of oligopoly theory that supposedly underlie modern competition policy. This book offers a fresh, in-depth exploration of competition law's horizontal agreement requirement, presents a systematic analysis of how best to address the problem of coordinated oligopolistic price elevation, and compares the resulting direct approach to the orthodox prohibition. The book elaborates the relevant benefits and costs of potential solutions, investigates how coordinated price elevation is best detected in light of the error costs associated with different types of proof, and examines appropriate sanctions. Existing literature devotes remarkably little attention to these key subjects and instead concerns itself with limiting penalties to certain sorts of interfirm communications. Challenging conventional wisdom, the book shows how this circumscribed view is less well grounded in the statutes, principles, and precedents of competition law than is a more direct, functional proscription. More important, by comparison to the communications-based prohibition, the book explains how the direct approach targets situations that involve both greater social harm and less risk of chilling desirable behavior—and is also easier to apply.

Competition Policy for the New Era

2018 ◽  
Keyword(s):  
Developing Countries ◽  
Emerging Economies ◽  
Competition Policy ◽  
Competition Law ◽  
Critical Discussion ◽  
Industrialized Countries ◽  
Collective Wisdom ◽  
Brics Countries ◽  
Law And Policy ◽  
The World

This book presents a new stage in the contributions of the BRICS countries (Brazil, Russia, India, China, and South Africa) to the development of Competition Law and policy. These countries have significant influence in their respective regions and in the world. The changing global environment means greater political and economic role for the BRICS and other emerging countries. BRICS countries are expected to contribute nearly half of all global gross domestic product growth by 2020. For more than a century, the path of Competition Law has been defined by the developed and industrialized countries of the world. Much later, developing countries and emerging economies came on the scene. They experience many of the old competition problems, but they also experience new problems, and experience even the old problems differently. Where are the fora to talk about Competition Law and policy fit for developing and emerging economies? The contributors in this book are well-known academic and practising economists and lawyers from both developed and developing countries. The chapters begin with a brief introduction of the topic, followed by a critical discussion and a conclusion. Accordingly, each chapter is organized around a central argument made by its author(s) in relation to the issue or case study discussed. These arguments are thoughtful, precise, and very different from each another. Each chapter is written to be a valuable freestanding contribution to our collective wisdom. The set of case studies as a whole helps to build a collection of different perspectives on competition policy.

scholarly journals Recent Studies on Common Ownership, Firm Behavior, and Market Outcomes

2021 ◽  
Vol 66 (1) ◽  
pp. 12-38
Author(s):  
Martin C. Schmalz
Keyword(s):  
Firm Behavior ◽  
Fast Rate ◽  
Empirical Work ◽  
Estimation Methods ◽  
Reduced Form ◽  
Market Outcomes ◽  
Competitive Effects ◽  
The Past ◽  
Common Ownership ◽  
Meaningful Research

The literature on competitive effects of common ownership has grown at a fast rate in the past two years. Anticompetitive effects have been confirmed with alternative reduced-form and structural estimation methods, in different industries, geographies, and jurisdictions. Multiple independent studies have disproven early critiques of the literature. Other papers document the heterogeneity of common ownership effects on competition across markets and industries. Important advances were made on the study of the economic mechanisms and governance channels that implement anti-competitive incentives. New theory refines the interpretation of existing empirical work. Access to high-quality ownership and product-market data remains a bottleneck for meaningful research in the area.

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