Price Theory and US Antitrust: a Note on an Enduring Legal Doctrine

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Abstract

Since the mid-1980s the post-Chicago approach to antitrust economics has produceda few game-theoretic models which have challenged many typical Chicago antitrustpropositions. Yet, Chicago style antitrust has not yet lost its hold on u.s. antitrust. Thepaper suggests that the Chicago persistence within u.s. antitrust and, by the same token,the inhospitality of u.s. antitrust towards game-theoretical Industrial Organizationtheory owe much to the vitality of the legal doctrine according to which antitrustanalysis should be consistent with traditional price theory. In particular, the paper analyzestwo issues: i. the adoption of the equilibrium end-state notion of competitionwhich is still dominant within mainstream economics and ii. the unshaken faith in theresilience of competition vis-à-vis Type ii errors committed by antitrust Agencies,provided that government-induced barriers to entry be absent or negligible.
Original languageEnglish
Pages (from-to)113-123
Number of pages11
JournalHistory of Economic Ideas
Volume21
Publication statusPublished - 2013

All Science Journal Classification (ASJC) codes

  • History
  • Sociology and Political Science
  • Economics and Econometrics

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