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TOTM I have spent the last few days reading the recent study by Clifford Winston, Robert W. Crandall, and Vikram Maheshri, entitled “First Thing We Do: . . .
I have spent the last few days reading the recent study by Clifford Winston, Robert W. Crandall, and Vikram Maheshri, entitled “First Thing We Do: Let’s Deregulate All the Lawyers” (Brookings Institution, 2011, $19.95). In it, the authors marshal a variety of empirical methods to argue that the current practice of state bar admission and licensing of attorneys imposes an inefficient barrier to entry that keeps incomes high and reduces access to needed legal services (particularly among the poor). Moreover, the authors argue that the oligopoly rents enjoyed by practicing lawyers have grown further as the federal bureaucracy has grown, essentially feeding a legal / regulatory beast that that artificially increases the demand for lawyers, exacerbating the oligopoly problem. Given these observations, the authors conclude that the current practice of law is severely afflicted by anticompetitive barriers to entry, regulatory capture, and artificially inflated prices. In response, they advocate a good old school form of deregulation of the legal industry, allowing free (or nearly free) entry into the profession. Although they are open to keeping state bar exams around (primarily as certification devices), bar membership should not be – in their view – a necessary condition to the practice of law.
Read the full piece here.
TOTM Economist and occasional TOTM guest blogger Steve Salop (Georgetown) recently sent me the following questions spurred by the local debate over Governor McConnell’s proposal to . . .
Economist and occasional TOTM guest blogger Steve Salop (Georgetown) recently sent me the following questions spurred by the local debate over Governor McConnell’s proposal to private the retailing of alcoholic beverages…
TOTM Commissioner Rosch has offered an interesting separate statement on the new HMGs. While favoring the new guidelines generally, Commissioner Rosch offers several criticisms. I concur . . .
Commissioner Rosch has offered an interesting separate statement on the new HMGs. While favoring the new guidelines generally, Commissioner Rosch offers several criticisms. I concur with a few of these criticisms, for example, Commissioner Rosch also argues for a more empirical approach to merger analysis. I agree with that general proposition despite, as we shall see below, the fact that the Commissioner offers it along with the peculiar distinction between “economic evidence” which he rejects and “empirical evidence”. The Commissioner should be applauded for putting these criticisms, as well as those with which I disagree of course, on the record.
TOTM Let me add on a few brief observations on the Intel settlement to Dan’s earlier comments, with which I largely agree. There is a lot . . .
Let me add on a few brief observations on the Intel settlement to Dan’s earlier comments, with which I largely agree. There is a lot to say about the settlement: the predatory design aspects, Section 5, the (I found) quite odd self-congratulatory settlement press conference and webcast, and of course, what the settlement means for consumers. I’m very interested in all of these issues, but perhaps none is more important than the last. We cannot simply assume that the settlement equates to a victory for consumers. Readers of this blog will be very familiar with the argument that merely counting cases, or agency activity, and of course settlements, are not reliable measures of the quality of agency performance or meaningful from a consumer welfare perspective. But problems with this case make that warning especially appropriate here. Thus, before delving into some first reactions based on language in the settlement over the days and maybe weeks to come, some perspective is in order.
TOTM The Comprehensive Alcohol Regulatory Effectiveness Act — yes, the “CARE Act” — or HR 5034, is a piece of legislation aimed at supporting “State-based alcohol . . .
The Comprehensive Alcohol Regulatory Effectiveness Act — yes, the “CARE Act” — or HR 5034, is a piece of legislation aimed at supporting “State-based alcohol regulation.” Recall the Supreme Court’s decision in Granholm v. Heald, which held that states could either allow in-state and out-of-state retailers to directly ship wine to consumers or could prohibit it for both, but couldn’t ban direct shipment only for out-of-state sellers while allowing in for in-state sellers. Most states thus far have opened up direct shipping laws to the benefit of consumers. While we occasionally criticize the Federal Trade Commission from time to time here at TOTM, its own research demonstrating that state regulation banning direct shipment and e-commerce harmed consumers is an excellent example of the potential for competition research and development impacting regulatory debates. Indeed, Justice Kennedy’s majority opinion in Granholm cites the FTC study (not to mention co-blogger Mike Sykuta’s work here) a number of times. But in addition to direct shipment laws, there are a whole host of state laws regulating the sale and distribution of alcohol. Some of them have obviously pernicious competitive consequences for consumers as well as producers. The beneficiaries are the wholesalers who have successfully lobbied for the protection of the state. Fundamentally, the CARE Act aims to place these laws beyond the reach of any challenge under the Commerce Clause as per Granholm, the Sherman Act, or any other federal legislation. Whether the CARE Act has any ancillary social benefits is an important empirical question — but you can bet that the first-order effect of the law, if it were to go into effect, would be to increase beer, wine and liquor prices. More on the CARE Act and state regulation of alcoholic beverages below the fold.
TOTM One of my summer writing projects is a response to Einer Elhauge’s recent, highly acclaimed article, Tying, Bundled Discounts, and the Death of the Single . . .
One of my summer writing projects is a response to Einer Elhauge’s recent, highly acclaimed article, Tying, Bundled Discounts, and the Death of the Single Monopoly Profit Theory. In the article, which appeared in the December 2009 Harvard Law Review, Elhauge defends current tying doctrine, which declares tie-ins to be per se illegal when the defendant has market power in the tying product market and the tie-in affects a “not insubstantial” volume of commerce in the tied product market.
TOTM The subject of antitrust exemptions has been an oft-discussed topic here at TOTM (see, e.g. here and here). In the latter of those two links . . .
The subject of antitrust exemptions has been an oft-discussed topic here at TOTM (see, e.g. here and here). In the latter of those two links I was somewhat critical of the DOJ for taking a neutral stance on the insurance industry exemption, which has now become rather wrapped up in the health care reform debate. I wrote…
TOTM A new Russian retail trade law is scheduled to (at least partially) go into effect on February 1st. The new retail trade law, with the . . .
A new Russian retail trade law is scheduled to (at least partially) go into effect on February 1st. The new retail trade law, with the support of the national antitrust authority and Prime Minister Putin amongst others, has three essential features: (1) limiting the operation of chains to no more than 25 percent of total sales within particular geographic regions, i.e. prohibition on internal expansion or merger, (2) restrictions on the ability of suppliers and retailers to enter into slotting arrangements and other payments for shelf space, and (3) price controls on some subset of “socially-important” goods.
TOTM Simon Johnson is at it again, advocating the use of antitrust to break up the banks because they are, you know, big, and antitrust is . . .
Simon Johnson is at it again, advocating the use of antitrust to break up the banks because they are, you know, big, and antitrust is about busting up big companies, right?
