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Neoclassical Labor Economics: Its Implications For Labor And Employment Law, Michael L. Wachter Dec 2012

Neoclassical Labor Economics: Its Implications For Labor And Employment Law, Michael L. Wachter

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Whereas law and economics appears throughout business law, it never caught on in legal commentary about labor and employment law. A major reason is that the goals of the National Labor Relations Act (NLRA), the country’s foundational labor law, are at war with basic principles of economics. The lack of integration is unfortunate if understandable. Notwithstanding the NLRA’s normative goal to keep wages out of competition, economic analysis applies as centrally to labor markets as to any other market.

One of the NLRA’s primary goals is to equalize bargaining power. Its drafters envisioned achieving this goal through procedural and substantive …


Vertical Restraints, Dealers With Power, And Antitrust Policy, Herbert J. Hovenkamp Dec 2010

Vertical Restraints, Dealers With Power, And Antitrust Policy, Herbert J. Hovenkamp

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The Supreme Court’s Leegin decision has now brought the rule of reason to all purely vertical intrabrand distribution restraints. But the rule of reason does not mean per se legality and occasions for anticompetitive vertically imposed restraints may still arise. Of all those that have been suggested the most plausible are vertical restraints imposed at the behest of a powerful dealer or group (cartel) of dealers.

Although a vertical distribution restraint resembles a dealer cartel in that both limit intraband competition, a manufacturer restraining the distribution of its product shuns the excess dealer profits a dealer cartel would seek. Accordingly, …