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Full-Text Articles in Economic Theory
Antitrust Error Costs, Herbert J. Hovenkamp
Antitrust Error Costs, Herbert J. Hovenkamp
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The idea that consideration of error costs should inform judgments about actions with uncertain consequences is well established. When we act on imperfect information, we consider not only the probability of an event, but also the expected costs of making an error. In 1984 Frank Easterbrook used this idea to rationalize an anti-enforcement bias in antitrust, reasoning that markets are likely to correct monopoly in a relatively short time while judicial errors are likely to persist. As a result, false positives (recognizing a problem when there is none) are more costly than false negatives. While the problem of error cost …
Addressing The Divisions In Antitrust Policy, Herbert J. Hovenkamp
Addressing The Divisions In Antitrust Policy, Herbert J. Hovenkamp
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This is the text of an interview conducted in writing by Professor A. Douglas Melamed, Stanford Law School.