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Geoffrey A. Manne headshot

President and Founder

Geoffrey A. Manne is president and founder of the International Center for Law and Economics (ICLE), a nonprofit, nonpartisan research center based in Portland, Oregon. He is also a distinguished fellow at Northwestern University’s Center on Law, Business, and Economics. Previously he taught at Lewis & Clark Law School. Prior to teaching, Manne practiced antitrust law at Latham & Watkins, clerked for Hon. Morris S. Arnold on the 8th Circuit Court of Appeals, and worked as a research assistant for Judge Richard Posner. He was also once (very briefly) employed by the FTC. Manne holds AB & JD degrees from the University of Chicago.

Eric Fruits headshot

Senior Scholar

Eric Fruits is a senior scholar at the International Center for Law & Economics and an adjunct professor of economics at Portland State University.

Antitrust

Antitrust Consumer Protection

TL;DR

Antitrust & Consumer Price Inflation

Background…

Some U.S. lawmakers have pointed the finger at rising concentration and alleged anticompetitive behavior by both suppliers (e.g., meat packers; oil & gas companies) and retailers (e.g., groceries; online retailers) as the cause of recent, sharp increases in consumer prices. They propose vigorous antitrust enforcement as a tool to stop the scourge of rising prices.

But…

While consumer prices have increased sharply in just the past year, concentration numbers in the relevant markets have been relatively unchanged for years or even decades. The best case that can be mustered is that existing market structures may slightly exacerbate short-term price dislocations whose ultimate cause is exogenous supply and demand shocks brought about by the COVID-19 pandemic and government responses to it.

Moreover…

The purpose of antitrust law is to protect competition, not to guarantee low prices in and of themselves. High or rising prices are not an antitrust violation, as they may be the result of the undistorted competition that antitrust ultimately protects, and the price system is the most effective means of resource allocation, even when the process itself is painful. There are a host of reasons to expect higher prices in the current environment, but virtually none of the evidence points to anticompetitive conduct as one of them.

Read the full explainer here.