Law Commons^™

Teece's Competing Through Innovation, Herbert J. Hovenkamp

All Faculty Scholarship

This essay reviews David J. Teece's book, Competing Through Innovation: Technological Strategies and Antitrust Policies (2013).

Actavis And Error Costs: A Reply To Critics, Aaron S. Edlin, C. Scott Hemphill, Herbert J. Hovenkamp, Carl Shapiro

All Faculty Scholarship

The Supreme Court’s opinion in Federal Trade Commission v. Actavis, Inc. provided fundamental guidance about how courts should handle antitrust challenges to reverse payment patent settlements. In our previous article, Activating Actavis, we identified and operationalized the essential features of the Court’s analysis. Our analysis has been challenged by four economists, who argue that our approach might condemn procompetitive settlements.

As we explain in this reply, such settlements are feasible, however, only under special circumstances. Moreover, even where feasible, the parties would not actually choose such a settlement in equilibrium. These considerations, and others discussed in the reply, serve to …

Interpreting, Stephanie Jo Kent

Doctoral Dissertations

What do community interpreting for the Deaf in western societies, conference interpreting for the European Parliament, and language brokering in international management have in common? Academic research and professional training have historically emphasized the linguistic and cognitive challenges of interpreting, neglecting or ignoring the social aspects that structure communication. All forms of interpreting are inherently social; they involve relationships among at least three people and two languages. The contexts explored here, American Sign Language/English interpreting and spoken language interpreting within the European Parliament, show that simultaneous interpreting involves attitudes, norms and values about intercultural communication that overemphasize information and discount …

Competition Policy And The Technologies Of Information, Herbert J. Hovenkamp

All Faculty Scholarship

When we speak about information and competition policy we are usually thinking about oral or written communications that have an anticompetitive potential, and mainly in the context of collusion of exclusionary threats. These are important topics. Indeed, among the most difficult problems that competition policy has had to confront over the years is understanding communications that can be construed as either threats to exclude or as offers to collude or facilitators of collusion.

My topic here, however, is the relationship between information technologies and competition policy. Technological change can both induce and undermine the use of information to facilitate anticompetitive …

Antitrust And The Close Look: Transaction Cost Economics In Competition Policy, Herbert J. Hovenkamp

All Faculty Scholarship

This paper briefly examines the contributions of Transaction Cost Economics (TCE) to antitrust analysis, focusing on vertical integration and its contractual substitutes, mainly, minimum and maximum resale price maintenance, vertical nonprice restraints, tying, bundled discounts and exclusive dealing and related exclusionary contracts.

TCE generally assumes that business firms organize their activities so as to maximize their value, which they can do both by economizing and also by obtaining higher prices. Sensible antitrust policy recognizes that both advantageous contracting and monopoly can be profitable to a firm, and it can be expected to pursue both when they are available. Nevertheless, the …

Cartelization Through Buyer Groups, Chris Doyle, Martijn Han

Martijn A. Han

Retailers may enjoy stable cartel rents in their output market through the formation of a buyer group in their input market. A buyer group allows retailers to commit credibly to increased input prices, which serve to reduce combined final output to the monopoly level; increased input costs are then refunded from suppliers to retailers through slotting allowances or rebates. The stability of such an ‘implied cartel’ depends on the retailers’ incentives to source their inputs secretly from a supplier outside of the buyer group arrangement at lower input prices. Cheating is limited if retailers sign exclusive dealing or minimum purchase …

Implementing Antitrust's Welfare Goals, Herbert J. Hovenkamp

All Faculty Scholarship

United States antitrust policy is said to promote some version of economic welfare. Antitrust promotes allocative efficiency by ensuring that markets are as competitive as they can practicably be, and that firms do not face unreasonable roadblocks to attaining productive efficiency, which refers to both cost minimization and innovation. One important welfare debate is whether antitrust should adopt a “consumer welfare” principle rather than a more general “total welfare” principle.

The simple version of the consumer welfare test is not a balancing test. If consumers are harmed by reduced output or higher prices resulting from the exercise of market power, …

Merger Policy And The 2010 Merger Guidelines, Herbert J. Hovenkamp

All Faculty Scholarship

New Horizontal Merger Guidelines were issued jointly by the Antitrust Division and the Federal Trade Commission in August, 2010, replacing Guidelines issued in 1992 that no longer reflected either the law or government enforcement policy. The new Guidelines are a striking improvement. They are less technocratic, accommodating a greater and more realistic variety of theories about why mergers of competitors can be anticompetitive and, accordingly, a greater variety of methodologies for assessing them.

The unifying theme of the Horizontal Merger Guidelines is to prevent the enhancement of market power that might result from mergers. The 2010 Guidelines state that “[a] …

Harm To Competition Under The 2010 Horizontal Merger Guidelines, Herbert J. Hovenkamp

All Faculty Scholarship

In August, 2010, the Antitrust Division and the Federal Trade Commission issued new Guidelines for assessing the competitive effects of horizontal mergers under the antitrust laws. These Guidelines were long awaited not merely because of the lengthy interval between them and previous Guidelines but also because enforcement policy had drifted far from the standards articulated in the previous Guidelines. The 2010 Guidelines are distinctive mainly for two things. One is briefer and less detailed treatment of market delineation. The other is an expanded set of theories of harm that justify preventing mergers or reversing mergers that have already occurred.

The …

Barreras A La Competencia Y Libre Concurrencia E Insumos Esenciales, Carlos Mena-Labarthe

Carlos Mena-Labarthe

En la Constitución Mexicana y la Ley Federal de Competencia Económica se establecen facultades para que la autoridad de competencia elimine barreras y regule insumos.

Las investigaciones de mercado son una herramienta adicional que permite obtener una perspectiva integral de los mercados para la corrección de fallas conductuales y estructurales.

Se trata de un procedimiento muy riguroso con plazos establecidos para su ejecución.

Las investigaciones de mercado han resultado exitosas en otras jurisdicciones con una sólida tradición en competencia económica.

Patent Assertion Entities & Privateers: Economic Harms To Innovation And Competition, Robert G. Harris

Robert G Harris

This paper addresses the problems of aggressive rent-seeking activities by patent assertion entities (PAEs) and privateers. Section II explains why aggressive patent assertion is especially problematic in patent thick products and systems (such as computers, smartphones and software), and why technological developments have increased the number and “density” of patent thickets. Section III addresses the fundamental differences in the strategic positions and interests of practicing entities and PAEs, and explains why those differences affect the conduct of PAEs and increase the opportunities for, and economic harm caused by, their rent-seeking conduct and efforts to engage in patent hold-up. Section IV …

Patent Assertion Entities & Privateers: Economic Harms To Innovation & Competition, Robert G. Harris

Robert G Harris

This paper addresses the problems of aggressive rent-seeking activities by patent assertion entities (PAEs) and privateers. Section II explains why aggressive patent assertion is especially problematic in patent thick products and systems (such as computers, smartphones and software), and why technological developments have increased the number and “density” of patent thickets. Section III addresses the fundamental differences in the strategic positions and interests of practicing entities and PAEs, and explains why those differences affect the conduct of PAEs and increase the opportunities for, and economic harm caused by, their rent-seeking conduct and efforts to engage in patent hold-up. Section IV …

New Powers- New Vulnerabilities? A Critical Analysis Of Market Inquiries Performed By Competition Authorities, Tamar Indig, Michal Gal

Michal Gal

In the past two decades the number of jurisdictions which have empowered their Competition Authorities to engage in market inquiries (MIs) has grown substantially. Although jurisdictions differ in the scope and procedure adopted for such studies, they all share an important common trait: attempting to allocate the roots of limited competition in the studied market. Market studies differ from traditional competition law tools in their triggers, range, object, and the level of pro-activity of the Competition Authority. They are not triggered by a suspicion of anti-competitive conduct of specific firm(s), but rather allow the Authority to use a broad prism …

Cartel Detection And Collusion Screening: An Empirical Analysis Of The London Metal Exchange, Danilo Samà

Dr. Danilo Samà

Cartel detection and collusion screening: an empirical analysis of the London Metal Exchange
Author:Dr Danilo Samà (LUISS “Guido Carli” University, Law & Economics LAB)
Abstract:In order to fight collusive behaviors, the best scenario for competition authorities would be the possibility to analyze detailed information on firms’ costs and prices, being the price-cost margin a robust indicator of market power. However, information on firms’ costs is rarely available. In this context, a fascinating technique to detect data manipulation and rigged prices is offered by an odd phenomenon called Benford’s law, otherwise known as First-digit law, which has been successfully …

Essays On Economic Analysis Of Competition Law: Theory And Practice (Ph.D. Dissertation Defence), Dr. Danilo Samà

Dr. Danilo Samà

Essays on economic analysis of competition law: theory and practice
Author:Dr Danilo Samà (LUISS “Guido Carli” University, Law & Economics LAB)
Abstract:The Ph.D. dissertation, submitted to LUISS “Guido Carli” University of Rome in fulfillment of the requirements for the Degree of Doctor of Philosophy in Economic Analysis of Competition Law (XXV cicle), is the result of a scientific research in the field of the economic analysis of competition law developed through academic experiences at the Erasmus Rotterdam University in the Netherlands, the Ghent University in Belgium, the University of Hamburg in Germany and the Toulouse School of Economics in …

Essays On Economic Analysis Of Competition Law: Theory And Practice, Danilo Samà

Dr. Danilo Samà

Essays on economic analysis of competition law: theory and practice
Author:Dr Danilo Samà (LUISS “Guido Carli” University, Law & Economics LAB)
Abstract:The Ph.D. dissertation, submitted to LUISS “Guido Carli” University of Rome in fulfillment of the requirements for the Degree of Doctor of Philosophy in Economic Analysis of Competition Law (XXV cicle), is the result of a scientific research in the field of the economic analysis of competition law developed through academic experiences at the Erasmus Rotterdam University in the Netherlands, the Ghent University in Belgium, the University of Hamburg in Germany and the Toulouse School of Economics …

Consumer Welfare In Competition And Intellectual Property Law, Herbert J. Hovenkamp

All Faculty Scholarship

Whether antitrust policy should pursue a goal of "general welfare" or "consumer welfare" has been debated for decades. The academic debate is much more varied than the case law, however, which has consistently adopted consumer welfare as a goal, almost never condemning a practice found to produce an actual output reduction or price increase simply because productive efficiency gains accruing to producers exceeded consumer losses.

While some practices such as mergers might produce greater gains in productive efficiency than losses in consumer welfare, identifying such situations would be extraordinarily difficult. First, these efficiencies would have to be "transaction specific," meaning …

Robert Bork And Vertical Integration: Leverage, Foreclosure, And Efficiency, Herbert J. Hovenkamp

All Faculty Scholarship

Robert H. Bork wrote his fist article about vertical integration and antitrust policy in 1954, a year after he graduated from the University of Chicago Law School. He noted a recent increase in antitrust attacks on vertical integration and disagreed with those who believed that these attacks were a novelty. At the time, judicial hostility toward vertical integration was rampant. But Bork overstated his case about the period prior to the 1930s. Through the 1920s judicial attitudes toward vertical integration were more benign than Bork suggested. This position was largely consistent with the pre-Depression economics literature, which emphasized production cost …

The Hidden Costs Of Free Goods: Implications For Antitrust Enforcement, Michal Gal, Daniel Rubinfeld

Michal Gal

Today a growing number of goods and services are provided in the marketplace free of charge; indeed, free or the appearance of free, have become part of our ecosystem. More often than not, free goods and services provide real benefits to consumers and are clearly pro-competitive. Yet free goods may also create significant costs. We show that despite the fact that the consumer does not pay a direct price, there are indirect prices that reflect the opportunity cost associated with the consumption of free goods. These indirect costs can be overt or covert, in the same market in which the …