ICLE President Geoffrey Manne quoted in Cato on developments of Section 2 jurisprudence
ICLE President Geoffry Manne and Senior Scholar Joshua Wright were recently cited by the Cato Journal for their expertise on the history of Section 2 jurisprudence:
Both Microsoft’s critics in Silicon Valley and its defenders among free-market economists acknowledged that the case needed to turn on the consumer welfare standard, per the appeals court: “To be condemned as exclusionary, a monopolist’s act must have an ‘anticompetitive effect.’ That is, it must harm the competitive process and thereby harm consumers.”
Law professors Geoffrey Manne and Joshua Wright — in a 2011 paper on Google and antitrust — summarized decades’ worth of Supreme Court jurisprudence on Section 2 of the Sherman Act against attempted monopolization:
- Mere possession of monopoly power is not an antitrust offense.
- The mere exercise of lawful monopoly power in the form of higher prices is not an antitrust violation.
- Courts must be concerned with the social costs of antitrust errors, and the error-cost framework is a desirable approach to developing standards that incorporate these concerns.
This “error-cost framework” requires the plaintiff, often the government, to prove exclusionary conduct. The accused monopolist has the opportunity to introduce evidence of pro-competitive effects. Unrebutted positive effects are then weighed against the consumer harms of exclusionary effects.