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The Market Power Model Of Contract Formation: How Outmoded Economic Theory Still Distorts Antitrust Doctrine, Alan J. Meese
The Market Power Model Of Contract Formation: How Outmoded Economic Theory Still Distorts Antitrust Doctrine, Alan J. Meese
Alan J. Meese
Transaction cost economics ("TCE") has radically altered industrial organization's explanation for so-called "non-standard contracts, "including "exclusionary" agreements that exclude rivals from access to inputs or customers. According to TCE, such integration usually reduces transaction costs without producing anticompetitive harm. TCE has accordingly exercised growing influence over antitrust doctrine, with courts invoking TCE's teachings to justify revision of some doctrines once hostile to such contracts. Still, old habits die hard, even for courts of increasing economic sophistication. This Article critiques one such habit, namely, courts'continuing claim that firms use market or monopoly power to impose exclusionary contracts on unwilling trading partners. …
Assorted Anti-Leegin Canards: Why Resistance Is Misguided And Futile, Alan J. Meese
Assorted Anti-Leegin Canards: Why Resistance Is Misguided And Futile, Alan J. Meese
Alan J. Meese
In Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007), the Supreme Court reversed Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U.S. 373 (1911), which had banned minimum resale price maintenance (“minimum RPM”) as unlawful per se. For many, Leegin was a straightforward exercise of the Court’s long-recognized authority, implied by the Sherman Act’s rule of reason, to adjust antitrust doctrine in light of new economic learning. In particular, Leegin invoked the teachings of transaction cost economics (“TCE”), which holds that many non-standard agreements, including minimum RPM, are voluntary mechanisms …