Notes
Outline
The origins of antitrust law.
High transportation and transaction costs.
The origins of antitrust law.
Economic expansion.
Economic expansion.
The rise of the large corporation.
The rise of the large corporation.
The Sherman Antitrust Act.
The Sherman Antitrust Act.
The Sherman Antitrust Act.
The antitrust paradox.
Economic efficiency.
Lower prices benefit consumers.
Protecting competitors.
Lower prices harm (small) competitors.
The antitrust paradox.
Early enforcement of Sherman.
Little serious early enforcement.
Early cases.
U. S. v. E. C. Knight (1895).
Sugar trust.
Commerce v. manufacturing.
U. S. v. Trans-Missouri Freight (1897).
Restraints of trade per se illegal.
U. S. v. Addyston Pipe (1898).
Taft: naked restraints v. ancillary restraints.
Early enforcement of Sherman.
E. C. Knight demonstrated that Sherman applied only to cartels not holding companies.
Addyston Pipe demonstrated that the Court would in fact enforce Sherman against cartels.
More than 1800 firms disappeared in mergers and acquisitions.
Major trusts formed.
Early enforcement of Sherman.
Teddy Roosevelt turns moribund Act into a political weapon.
Northern Securities Co. v. United States (1902).
Attacks J. P. Morgan, who later comes to Roosevelt’s aid.
Court rules that Sherman does apply to holding companies.
Early enforcement of Sherman.
Standard Oil Co. of New Jersey v. United States, 221 U.S. 1 (1911).
The value of Rockefeller’s stock increased after the breakup.
U.S. v. American Tobacco, 221 U.S. 106 (1911).
The rule of reason.
“Unreasonable or undue restraint of trade in interstate commerce.”
Contracts or combinations not illegal per se.
The Clayton and FTC acts.
Demand for additional legislation.
Perceived limitations of Sherman.
The “Progressive Era.”
Two approaches (1914).
House: enumerate practices to be unlawful.
Senate: give discretion to an independent authority.
Compromise.
Clayton Act enumerates practices.
FTC Act creates independent agency.
The Clayton and FTC acts.
The Clayton and FTC acts.
The Clayton and FTC acts.
The Clayton and FTC acts.
The Clayton and FTC acts.
The Clayton and FTC acts.
The Clayton and FTC acts.
Dual-enforcement system.
FTC empowered to enforce FTC Act and sections 2, 3, 7, 8 of Clayton.
Department of Justice enforces Sherman and Clayton independently.
1948 Supreme Court case extends FTC jurisdiction to Sherman and leads to coordinated dual-enforcement system.
FTC as administrative law system, but ultimately differences aren’t large.