Consumer Welfare & the Rule of Law: The Case Against the New Populist Antitrust Movement, Pepperdine Law Review
In this paper, forthcoming in the Pepperdine Law Review, Elyse Dorsey, Geoffrey A. Manne, Jan M. Rybnicek, Kristian Stout, and Joshua D. Wright argue that the modern consumer welfare standard is an objective, consistent, reliable, and appropriate framework for good antitrust law and enforcement.
“Populist antitrust notions suddenly are fashionable again. At their core is the view that antitrust law is responsible for a myriad of purported socio-political problems plaguing society today, including but not limited to rising income inequality, declining wages, and increasing economic and political concentration. Seizing on Americans’ fears about changes to the modern US economy, proponents of populist antitrust policies assert the need to fundamentally reshape how we apply our nation’s competition laws in order to implement a variety of prescriptions necessary to remedy these perceived social ills. The proposals are varied and expansive but have the unifying theme of returning antitrust to the “big-is-bad” enforcement era prevalent in the first half of the twentieth century. They would ban broad categories of procompetitive mergers, forbid businesses from pursuing commercial arrangements that benefit consumers, and protect inefficient high-cost producers from precisely the type of competition the antitrust laws are intended to foster. In doing so, the populist antitrust proposals reject fundamental lessons gleaned from developments in modern economics and would send antitrust careening back to the equivalent of its Stone Age.