Law Commons^™

An Aggregate Approach To Antitrust: Using New Data And Rulemaking To Preserve Drug Competition, C. Scott Hemphill

Center for Contract and Economic Organization

This Article examines the "aggregation deficit" in antitrust: the pervasive lack of information, essential to choosing an optimal antitrust rule, about the frequency and costliness of anticompetitive activity. By synthesizing available information, the present analysis helps close the information gap for an important, unresolved issue in U.S. antitrust policy: patent settlements between brand-name drug makers and their generic rivals. The analysis draws upon a new dataset of 143 such settlements.

Due to the factual complexity of individual brand-generic settlements, important trends and arrangements become apparent only when multiple cases are examined collectively. This aggregate approach provides valuable information that can …

Contracting For Innovation: Vertical Disintegration And Interfirm Collaboration, Ronald J. Gilson, Charles F. Sabel, Robert E. Scott

Faculty Scholarship

Rapidly innovating industries are not behaving the way theory expects. Conventional industrial organization theory predicts that, when parties in a supply chain have to make transaction-specific investments, the risk of opportunism will drive them away from contracts and toward vertical integration. Despite the conventional theory, however, contemporary practice is moving in the other direction. Instead of vertical integration, we observe vertical disintegration in a significant number of industries, as producers recognize that they cannot themselves maintain cutting-edge technology in every field required for the success of their products. In doing this, the parties are developing forms of contracting beyond the …