Search Results

As part of a set of “shock therapy” measures introduced to deregulate and stabilize its economy, the Argentinian government led by newly elected President Javier Milei has already adopted an emergency decree (Decreto de Necesidad y Urgencia) that makes broad array of legal changes. Toward the same goal, the government in late December sent up an omnibus bill on Bases and Starting Points for the Freedom of Argentines Act that, among its 600 changes, proposes to modify the current Act for the Defense of Competition (Act No. 27.442).^[1]

Read the full piece here.

In a previous article, we refuted four common critiques of the consumer welfare standard (CWS). In this article, we argue that the CWS has key benefits which opponents overlook. Understood as a method rather than a set of goals, the CWS allows enforcers and courts to overcome fact-finding ambiguities inherent in competitive processes. Without the benefit of a consumer welfare standard as a yardstick, alternative frameworks such as “the protection of the competitive process” lack depth, are self-referential and, ultimately, arbitrary.

Read the full piece here.

As we approach a presidential election year, it is time to begin developing a  comprehensive reform agenda for the Federal Trade Commission (FTC). In that spirit, this post proposes 12 reforms that could be implemented by new leadership, either through unilateral action by a new chair or (in some cases) majority votes of the commission.

Read the full piece here.

It is no coincidence that ordoliberalism—the European (originally German) alternative to classical liberalism that emphasized the importance of the “social market” economy—and the New Brandeis or “neo-Brandeisian” movement, which harkens back to the Progressive Era thought of the late U.S. Supreme Court Justice Louis Brandeis, both are enjoying comebacks simultaneously. The effects of these ideological resurgences are most apparent specifically in the field of antitrust law (see here and here). But you can also see them in the broader political-economy movement to formulate an alternative to “neoliberalism” (here and here) that at least some audience find appealing.

The antitrust mainstream has long dismissed the ideas associated with these movements as populist, romantic, or naïve. Being called an “ordoliberal” was, until relatively recently, considered an epithet in Europe. And before individuals associated with their views were elevated into the U.S. antitrust establishment, gaining the attendant aura of respectability that accompanies occupying such lofty heights, the neo-Brandeisians were commonly derided as practicing “hipster antitrust.”

But these glib dismissals underestimated, at their own expense, the visceral appeal of the arguments the ordoliberals and neo-Brandeisians put forward. Ideas that had been relegated to the fringes of academia have begun to seep into the mainstream, and now threaten to upend the “neoliberal” antitrust order—all because opponents refused to take them seriously. As in the past, this trend can only be reverted through a better understanding of why these ideologies are so attractive, and why they ultimately fall flat.

Read the full piece here.

One of the most important changes in the Federal Trade Commission (FTC) and U.S. Justice Department’s (DOJ) draft merger guidelines is the abandonment of market power as the central element of merger enforcement. The “unifying theme” of the 2010 horizontal merger guidelines was that “mergers should not be permitted to create, enhance, or entrench market power or to facilitate its exercise.” The draft guidelines have dropped the unifying theme language.

The guidelines’ abandonment of enhancement of market power as the central element of merger enforcement will have profound consequences for antitrust. One consequence is that merger enforcement will no longer prioritize consumers over competitors of the merging firms. Another important consequence, however, is the loss of a limiting principle in merger enforcement. Courts recognize that enhancement of market power is a necessary element of a merger challenge under antitrust law. The U.S. Circuit Court of Appeals for the D.C. Circuit made this point clear in its 2001 FTC v. H.J. Heinz opinion when it held that “[m]erger enforcement, like other areas of antitrust, is directed at market power.” The draft guidelines have removed enhancement of market power as a necessary element of a merger case.

Read the full piece here.

The consumer welfare standard has been the subject of a very effective contestation in modern antitrust law and policy literature. This contestation targets mostly United States law but, as we know, ideas travel fast. In spite of differences in law, policy, and institutions, contestations of consumer welfare frameworks have also emerged in slightly different terms in the European Union .

In this article, we lay bare the fundamental flaws of the modern critique of the consumer welfare standard. We show that critics misrepresent the meaning of the consumer welfare standard, distort the U.S. case law, and ignore important facts that do not align with their normative preferences. We conclude with the assertion that many criticisms of the consumer welfare standard among U.S. antitrust scholars reflect a critique of the U.S. judiciary’s attitude toward uncertainty and hard evidence rather than a critique of the consumer welfare standard itself.

Read the full piece here.

In this post—the last planned post for this symposium on The FTC’s New Normal (though we will continue to accept unsolicited submissions of responses)—I will offer some summary of the ideas that have been shared here over the past month, before turning to some of my own thoughts. To keep your attention rapt, I will preview that my thoughts will live up to the title of this post: I will sing some sincere praise for the Federal Trade Commission (FTC) and U.S. Justice Department’s (DOJ) honesty and newfound litigiousness.

Read the full piece here.

The draft merger guidelines that were released July 19 by the Federal Trade Commission (FTC) and U.S. Justice Department (DOJ) indicate a shift by the agencies toward an overreliance on structural market factors to trigger merger scrutiny. 

For example, Draft Guideline 1—titled “Mergers Should Not Significantly Increase Concentration in Highly Concentrated Markets”—would lower the bar for what constitutes a “highly concentrated” market on the Herfindahl-Hirschman Index (HHI). Evaluating mergers through this structural lens assumes both that concentration is present or escalating in the economy at large and that concentration always and only leads to harmful anticompetitive effects. Most detrimentally, it likely precludes the more nuanced assessment of a given merger’s impact on competition that the FTC had used over the preceding four decades. This shift will increase Type I errors in antitrust enforcement and rob or delay the benefits of competition-enhancing mergers to consumers. 

Read the full piece here.

In a recently published article in ProMarket, John Kwoka of Northeastern University (who “worked on the draft Merger Guidelines while serving at the Federal Trade Commission as chief economist to the chair in 2022”) asserts that the U.S. Justice Department (DOJ) and Federal Trade Commission’s (FTC) draft merger guidelines aim to improve “deficient merger enforcement” by focusing on “lessening of competition,” rather than on “consumer surplus.”

With due respect to Kwoka, the draft guidelines, if adopted, would not “return antitrust to a sound economic and legal foundation.” Rather, they would generate costly uncertainty by returning federal merger enforcement to the pre-1980s structuralist era, when “efficiencies” was a dirty word. By discouraging welfare-enhancing merger proposals, they would harm the American economy.

Read the full piece here.