Antitrust

:Antitrust is also the name for a movie, see Antitrust (movie)

Criticisms of antitrust

Monopolistic firms are in a privileged position to reap economic benefits by restricting output and raising prices, without fear of competition. However, Thomas Woods asserts that the industries most frequently accused of holding a monopolistic position in the late nineteenth century were neither restricting output nor raising prices.

Related Topics:
Thomas Woods - Nineteenth century

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The Results of "Predatory Pricing": Commodity Prices from 1880-1890

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During the 1880s output of monopolistic industries grew seven times faster than the overall economy, while prices in these industries were generally falling—even faster than the 7% rate of decline that occurred in the economy as a whole. {{ref|Woods}}

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Free market economist Milton Friedman states that he initially agreed with the underlying principles of antitrust laws (breaking up monopolies and oligopolies and promoting more competition), but came to the conclusion that they do more harm than good and that therefore they should not exist. {{ref|Friedman}}

Related Topics:
Free market - Milton Friedman - Monopolies - Oligopolies

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Critics also argue that the empirical evidence shows that "predatory pricing" does not work in practice, and is better defeated by a truly free market than by anti-trust laws (see Criticism of the theory of predatory pricing).

Related Topics:
Free market - Criticism of the theory of predatory pricing

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Thomas Sowell argues that even if a superior business drives out a competitor, it doesn't follow that competition has ended:

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:In short, the financial demise of a competitor is not the same as getting rid of competition. The courts have long paid lip service to the distinction that economists make between competition — a set of economic conditions — and existing competitors, though it is hard to see how much difference that has made in judicial decisions. Too often, it seems, if you have hurt competitors, then you have hurt competition, as far as the judges are concerned.http://www.forbes.com/forbes/1999/0503/6309089a.html

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