Suchergebnisse

1. The economics of predatory pricing -- 2. The two freedoms and British Common Law -- 3. American economists and destructive competition -- 4. Predatory pricing in the formative era of antitrust law -- 5. Predatory pricing in the structuralist era -- 6. The Chicago School and the irrelevance of predation -- 7. Harvard rules : Areeda and Turner's solution -- 8. The demise of predatory pricing as an antitrust violation -- 9. Conclusion.

Abstract
Contemporary critics of American antitrust law lament a supposed misinterpretation by modern, welfare-driven enforcers of the true meaning of the competition principle. This essay contributes to the debate by reconstructing the principle's historical origin. While it did not feature in the Sherman Act, the competition principle was introduced by the Supreme Court during the early years of antitrust law. The court formulated alternative versions of the principle; the one that eventually prevailed was neither populist nor neoclassical, as it was based on classical political economy and, in particular, on freedom of contract and "natural" values. This historical circumstance may pave the way for a new approach to antitrust law.

Economists regularly appear as expert witnesses in antitrust litigations. This paper analyzes how their models and methodologies have performed vis-à-vis the standards of relevance and reliability affirmed by the US Supreme Court in Daubert and its progeny. Some explanations for the economists' troubles when facing a Daubert challenge in antitrust cases are provided.

The paper draws on Stephen Siegel (1984) to argue that, while paving the way for constitutionalizing the free market in Lochner v. New York (1905), the reproduction cost method that the Supreme Court established in Smyth v. Ames (1898) as the preferred technique for assessing the value of a business for regulatory purposes also exposed the conventional character of any valuation exercise, against the claims of objectivity made by classical economists and mainstream jurists. The inconsistency between recognizing that "value is not a fact" and the classical laissez-faire philosophy underlying the Court's jurisprudence did not escape progressive critics, who concluded that government could legitimately fine-tune regulation in order to affect a business's value and pursue alternative socio-economic goals.

The controversy over railroad rates regulation was a fundamental component of the jurisprudential trajectory that culminated in Lochner v. New York (1905) and the so-called laissez-faire era of U.S. constitutional law. Constitutional protection of property required that regulation preserve the value of the regulated business. This article builds on Siegel (1984) to argue that, by selecting, as in Smyth v. Ames (1898), reproduction cost as the correct technique to calculate the value of a railway, the US Supreme Court retained its allegiance to the fundamental tenets of classical political economy even in a period of massive economic transformation, when classical analysis was widely deemed unable to account for the new reality of US industrial life.