| Consumer Surplus as the Appropriate Standard for Antitrust Enforcement Contributor(s): Pittman, Russell (Author), U. S. Department of Justice Antitrust Di (Created by) |
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ISBN: 1289008507 ISBN-13: 9781289008505 Publisher: Bibliogov OUR PRICE: $14.01 Product Type: Paperback Published: June 2013 |
| Additional Information |
| BISAC Categories: - Political Science |
| Physical Information: 0.05" H x 7.44" W x 9.69" (0.13 lbs) 22 pages |
| Descriptions, Reviews, Etc. |
| Publisher Description: In antitrust enforcement as in cost-benefit analysis, neoclassical economics may be interpreted as arguing for the use of a "total welfare" standard whose implementation treats transfers as welfare-neutral. Several recent papers call for antitrust agencies to move in the direction of this version of a total welfare standard for enforcement. However, as Williamson (1968) noted, horizontal mergers typically result in transfers that may greatly exceed in magnitude any deadweight loss or efficiency gain, so that a decision to ignore transfers may be quite important. I argue that such transfers are likely overall to be quite regressive, and thus that a consumer surplus standard rather than a total welfare standard may be appropriate for antitrust. Two common arguments against this standard a " that most mergers are in markets for intermediate goods, and that a consumer welfare standard implies a tolerance for monopsony a " are examined and found wanting. I argue in addition that, even if a total welfare standard is used, both the finance literature on merger outcomes and the structure of the U.S. enforcement agencies suggest that the use of a consumer surplus standard by the agencies is more likely to achieve that goal." |
