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ANTITRUST

ANTITRUST. Music: Claude DeBussy Prelude: Afternoon of a Faun (1894) Nocturnes (1900) La Mer (The Sea) (1905) Performed by Orchestre de la Suisse Romande, Conductor: Armin Jordan (1991). Possible Goals. Balance Allocative & Productive Efficiency Protect Small Businesses

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ANTITRUST

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  1. ANTITRUST • Music: Claude DeBussy • Prelude: Afternoon of a Faun (1894) • Nocturnes (1900) • La Mer (The Sea) (1905) • Performed by Orchestre de la Suisse Romande, Conductor: Armin Jordan (1991)

  2. Possible Goals • Balance Allocative & Productive Efficiency • Protect Small Businesses • Concern re Survival: “Right” to Profit • Concern re Concentrated Political Power • Distributive Justice: Prevent Overcharges to Consumers • Business Ethics: Outlaw Offensive Commercial Practices

  3. Antitrust Revolution • 4th Edition: Contains Thirteen Case Studies I Have Assigned in Prior Years • 5th Edition: Only Has Six of These

  4. SCOPE & ENFORCEMENT • The Reach of the Antitrust Laws • Public Enforcement • Private Enforcement • Relation Between Procedure & Substance • Conduct of Large Private Civil Lawsuit

  5. CONDUCT OF LARGE PRIVATE CIVIL LAWSUITS

  6. Conduct of Large Private Civil Lawsuits • Primary Focus: Settlement • Secondary Focus: Summary Judgment

  7. Order of Proceedings • Preliminary Negotiations • Complaint • Motion to Dismiss Part or All • Investigation & Discovery • Summary Judgment Motions • Trial Prep/Negotiations

  8. Investigation & Discovery: Interactive Process • Legal Research Set of Relevant Facts to Investigate • Discovery of Facts  More DetailedLegal Qs to Research • Theories Change as Get More Info

  9. Investigation & Discovery: Goals • Defendant • Limit Info Going to Plaintiff • Identify D Theory of Case (& Support) • Identify Evidence Key to P Theory of Case • Plaintiff: Find Evidence Sufficient to Survive Summary Judgment • Evidence Consistent w P Theory • Evidence Inconsistent w D Theory

  10. Investigation & Discovery: Finding Evidence • Witness Interviews • Early Interrogatories • Contentions • I.D. Witnesses & Documents • Document Review (Most Important) • Depositions • Later Interrogatories: What Evidence Supports Claims

  11. Order of Proceedings • Preliminary Negotiations • Complaint • Motion to Dismiss Part or All • Investigation & Discovery • Summary Judgment Motions • Trial Prep/Negotiations

  12. THEMES OF THIS COURSE • Power of Attorneys & Legal Academics to Change the Law

  13. HISTORICAL TRENDS • 1945-75: Anti-Big Business Ideology • 1975-92: “Antitrust Revolution” • 1992-2000: Line-Drawing and Some Counter-Revolution • 2001 : ???

  14. INTRODUCTION TO THE ECONOMICS OF ANTITRUST

  15. ASSUMPTIONS OF CLASSICAL ECONOMICS • PEOPLE ACT RATIONALLY TO MAXIMIZE THEIR OWN INTERESTS

  16. ASSUMPTIONS OF CLASSICAL ECONOMICS • PEOPLE ACT RATIONALLY TO MAXIMIZE THEIR OWN INTERESTS • RESOURCES MOVE TO MOST VALUABLE USE IF VOLUNTARY EXCHANGE PERMITTED

  17. “VALUE” MEASURED BY AGGREGATE CONSUMER WILLINGNESS TO PAY FOR THINGS

  18. “EFFICIENCY” EXPLOITING ECONOMIC RESOURCES TO MAXIMIZE “VALUE”

  19. Given these definitions … • Voluntary transactions are “efficient”

  20. Given these definitions … • Voluntary transactions are “efficient” • Free market is “efficient” • allows sequences of transactions • resources end up w those who most value them

  21. Given these definitions … • Voluntary transactions are “efficient” • Free market is “efficient” • allows sequences of transactions • resources end up w those who most value them • Interference with market by government or cartel is “inefficient”

  22. PROBLEMS WITH ASSUMPTIONS • DEFINITION OF “VALUE” • PEOPLE OFTEN IRRATIONAL

  23. PROBLEMS WITH ASSUMPTIONS • DEFINITION OF “VALUE” • CONSUMER CULTURE • DEPENDS ON INCOME DISTRIBUTION • MORE $ = MORE VOTES

  24. PROBLEMS WITH ASSUMPTIONS • PEOPLE OFTEN IRRATIONAL • OFTEN APPEAR TO ACT AGAINST SELF-INTEREST • OFTEN PERCEIVE SELVES ACTING AGAINST SELF-INTEREST

  25. PROBLEMS WITH ASSUMPTIONS • Raise Qs About Normative Use of Theory • Claims that results of comp. market always desirable • Claims that interference w comp. market always bad

  26. PROBLEMS WITH ASSUMPTIONS • Raise Qs About Normative Use of Theory • Theory Often Describes World Pretty Well

  27. PROBLEMS WITH ASSUMPTIONS • Raise Qs About Normative Use of Theory • Theory Often Describes World Pretty Well • ME: Works Best if Addressing Basic Consumer Items

  28. DEMAND CURVE: GENERALLY BUY MORE OF GOOD THE LESS IT COSTS

  29. DEMAND

  30. DEMAND CURVE:GENERALLY BUY MORE OF GOOD THE LESS IT COSTS: • SUBSTITUTION EFFECT • INCOME EFFECT

  31. DEMAND CURVE:GENERALLY BUY MORE OF GOOD THE LESS IT COSTS • SUBSTITUTION EFFECT: AS GOOD BECOMES CHEAPER, BUY IT INSTEAD OF ALTERNATIVES • INCOME EFFECT

  32. DEMAND CURVE:GENERALLY BUY MORE OF GOOD THE LESS IT COSTS • SUBSTITUTION EFFECT • INCOME EFFECT: AS GOOD BECOMES CHEAPER, PURCHASING POWER INCREASES, SO BUY MORE

  33. DEMAND CURVE:GENERALLY BY MORE OF GOOD THE LESS IT COSTSEXCEPTIONS (RARE): • INFERIOR GOODS • LUXURY GOODS

  34. DEMAND CURVE:GENERALLY BY MORE OF GOOD THE LESS IT COSTSEXCEPTIONS: • INFERIOR GOODS: GOODS YOU BUY MORE OF, THE LESS $ YOU HAVE • LUXURY GOODS

  35. DEMAND CURVE:GENERALLY BY MORE OF GOOD THE LESS IT COSTSEXCEPTIONS: • INFERIOR GOODS • LUXURY GOODS: GOODS YOU BUY BECAUSE OF THE HIGH PRICE

  36. FACTORS AFFECTING DEMAND • PERSONAL TASTE • INCOME • PRICE OF COMPLEMENTARY GOODS • PRICE OF SUBSTITUTES

  37. FACTORS AFFECTING DEMAND • PERSONAL TASTE • INCOME • PRICE OF COMPLEMENTARY GOODS • PRICE OF SUBSTITUTES

  38. FACTORS AFFECTING DEMAND • PERSONAL TASTE • INCOME • PRICE OF COMPLEMENTARY GOODS • PRICE OF SUBSTITUTES

  39. FACTORS AFFECTING DEMAND • PERSONAL TASTE • INCOME • PRICE OF COMPLEMENTARY GOODS • PRICE OF SUBSTITUTES

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