Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Thursday, February 13, 2020

The Honorable Douglas H. Ginsburg to Receive Justice Department's 2020 John Sherman Award

Judge Ginsburg has made an important contribution to antitrust and I am glad he is being recognized.  He is also one of the kindest people in the business.

From the press release:

The Antitrust Division of the Department of Justice will present Judge Douglas H. Ginsburg with the John Sherman Award for his lifetime contributions to the development of antitrust law and the preservation of economic liberty.  Judge Ginsburg will deliver remarks and receive the award during a ceremony on May 8, 2020, in the Great Hall of the Robert F. Kennedy Department of Justice Building.  

“Judge Ginsburg’s role in the advancement of antitrust law and policy cannot be overstated,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “It is a privilege for the division to recognize his career and achievements with this award.  Judge Ginsburg’s leadership in the Antitrust Division, as well as his incisive and cogent scholarship, has brought sound economic analysis to the forefront of antitrust law.  His contributions have greatly improved the ability of antitrust law to protect consumer welfare and to spur economic growth.”

Created in 1994, the John Sherman Award is presented by the Justice Department's Antitrust Division to a person or persons for outstanding contributions to the field of antitrust law, the protection of American consumers, and the preservation of economic liberty.

Judge Ginsburg received his undergraduate degree from Cornell University and his J.D. from the University of Chicago.  Following law school, Judge Ginsburg clerked for Judge Carl McGowan of the U.S. Court of Appeals for the D.C. Circuit and for U.S. Supreme Court Justice Thurgood Marshall.  He joined the faculty at Harvard Law School from 1975 to 1983, before serving as the Deputy Assistant Attorney General for Regulatory Affairs, Antitrust Division, U.S. Department of Justice, from 1983 to 1984; Administrator, Information and Regulatory Affairs, OMB, from 1984 to 1985; and Assistant Attorney General, Antitrust Division, U.S. Department of Justice, from 1985 to 1986.  Judge Ginsburg was appointed to the U.S. Court of Appeals for the District of Columbia Circuit in November 1986 and served as Chief Judge from July 2001 until February 2008.  Concurrent with his service on the federal bench, Judge Ginsburg has taught at the University of Chicago Law School and the New York University School of Law. He is currently a Professor of Law at the Antonin Scalia Law School, George Mason University, and a visiting professor at the University College London, Faculty of Laws. 

Judge Ginsburg’s efforts to incorporate economic analysis in antitrust enforcement is instrumental to how agencies and practitioners approach antitrust law today.  Of his many notable contributions, Judge Ginsburg elevated the role of economic analysis in antitrust enforcement by expanding the Division’s economics section and by creating the position of the Deputy Assistant Attorney General for Economic Analysis during his tenure as the Assistant Attorney General of the Antitrust Division.  Through his work with the Global Antitrust Institute at the Antonin Scalia Law School, Judge Ginsburg is renowned for helping international enforcers and judges apply economic insights in competition law.   Judge Ginsburg’s jurisprudence and scholarship further reflect the intellectual rigor that has marked his distinguished career.  He was an influential judge on the landmark United States v. Microsoft case in 2001, and the case remains foundational to understanding competition in high-tech markets. Judge Ginsburg’s scholarship is widely admired, and his academic works — ranging in topic from the application of antitrust law in a changing economy to the effects of extra-jurisdictional remedies — tackle complex questions and continue to influence students, enforcers, and practitioners alike. 

The award is named for the author of the Sherman Act of 1890, the nation's first and foremost antitrust law. John Sherman, a former congressman and senator, also served as Secretary of the Treasury from 1877 to 1881 and as Secretary of State from 1897 to 1898. Previous recipients have included Diane P. Wood (2015), James F. Rill (2012), Robert Pitofsky (2010), Herbert Hovenkamp (2008), Robert H. Bork (2005), Richard A. Posner (2003), Milton Handler (1998), Thomas Kauper and William Baxter (1996), Phillip Areeda (1995), and Howard Metzenbaum (1994).

February 13, 2020 | Permalink | Comments (0)

Assistant Attorney General Makan Delrahim Delivers Opening Remarks at Public Workshop on Venture Capital and Antitrust

See here.

February 13, 2020 | Permalink | Comments (0)

The Impact of Product Qualities on Downstream Bundling in a Distribution Channel

By: Angelika Endres (Paderborn University); Joachim Heinzel (Paderborn University)
Abstract: We study the impact of exogenous product qualities on a downstream firm’s decision to bundle and the welfare effects of downstream bundling. We consider a distribution channel with two downstream firms and two price-setting monopolistic upstream producers. One upstream firm sells its good 1 exclusively to one downstream firm and the other upstream firm sells its good 2 to both downstream firms. The downstream firms compete in prices and the two-product downstream firm has the option to bundle its goods. We find that downstream bundling aggravates the problem of double marginalization in the channel, but reduces the intensity of downstream competition. Finally, bundling is profitable for the two-product downstream firm only when the quality of good 2 exceeds the quality of good 1. However, bundling is always profitable when the production process is controlled by the downstream industry. The impact on total welfare is ambiguous and depends on the distribution of market power in the channel and the quality levels of the goods.

February 13, 2020 | Permalink | Comments (0)

Wednesday, February 12, 2020

Legal Obstacles to Private Enforcement of Competition Law

Michal Gal, University of Haifa - Faculty of Law and Rivi Dahan, University of Haifa, Faculty of Law identify Legal Obstacles to Private Enforcement of Competition Law.

ABSTRACT: Private enforcement of competition law serves many important goals, including deterrence of future anti-competitive harms and correction of past harms. This article sheds light on several potential legal obstacles to such enforcement which could prevent it from achieving its goals. The examples mainly build upon the experience of different jurisdictions with private litigation. It also suggests some possible solutions for dealing with or limiting such obstacles. As Europe is in the early stages of applying its Damages Directive and creating a private competition law enforcement regime, recognising – and possibly avoiding – obstacles to efficient private enforcement is both timely and important.

February 12, 2020 | Permalink | Comments (0)

The Incentives to Arbitrate (or to Settle) Antitrust Damages Actions under Directive 2014/104

Yves Herinckx, Brussels Court of Appeal has written on The Incentives to Arbitrate (or to Settle) Antitrust Damages Actions under Directive 2014/104.

ABSTRACT: The European Directive 2014/104 of 26 November 2014 deals with the private enforcement of competition law in the European Union, i.e. with damages claims arising from breaches of competition law. In its recital 48, the Directive states that it wishes to encourage the arbitration of these claims and their settlement. Various provisions of the Directive seek to constitute incentives to arbitration and settlement. This paper analyses these provisions and assesses their effectiveness, or lack of.

February 12, 2020 | Permalink | Comments (0)

Tuesday, February 11, 2020

The Curious Case of Competition Law and Health Equity

Theodosia Stavroulaki, University of Michigan Law School; University of Turin - Collegio Carlo Alberto describes The Curious Case of Competition Law and Health Equity.

ABSTRACT: Healthcare markets have started being created in Europe. Indeed, some countries, such as the UK, have introduced competitive forces in their health systems as a means to improve their efficiency and quality. The role of competition in healthcare is a hotly debated topic with some considering it “anathema” and others seeing it as “a magic bullet”. Aiming to spark this heated, albeit unsettled, debate, this article raises an additional concern: it contends that when competitive forces are introduced into a health system, the main actors involved in the provision of healthcare, mainly physicians acting either as gatekeepers or purchasers of healthcare services may enter into agreements that restrict competition among healthcare providers with a view to protecting equity and access to care. Shining a light on these antitrust concerns, this article asks the wider question: should competition authorities in Europe consider in their competition analysis the core objectives their health systems strive to attain, such as equity? How and to what extent can the antitrust enforcers integrate distributive concerns into their competition assessment on the basis of article 101 TFEU?

February 11, 2020 | Permalink | Comments (0)

Institutions and Incentives in Antitrust Enforcement

Spencer Waller, Chicago Loyola addresses Institutions and Incentives in Antitrust Enforcement.

ABSTRACT: One of the most vexing questions in U.S. antitrust law is the meaning of the rule of reason under Section One of the Sherman Act. The U.S. Supreme Court has struggled for over a century to give meaning and guidance for the broad language of the Sherman Act banning contracts, combinations, and conspiracies in restraint of trade. The modern Supreme Court has a relatively new interpretative strategy to consider what legal standard should apply to agreements that potentially harm competition.

February 11, 2020 | Permalink | Comments (0)

Who Bears the Welfare Costs of Monopoly? The Case of the Credit Card Industry

Kyle Herkenhoff, University of Minnesota - Minneapolis and Gajendran Raveendranathan, McMaster University ask Who Bears the Welfare Costs of Monopoly? The Case of the Credit Card Industry.

ABSTRACT: How are the welfare costs from monopoly distributed across U.S. households? We answer this question for the U.S. credit card industry, which is highly concentrated, charges interest rates that are 3.4 to 8.8 percentage points above perfectly competitive pricing, and has repeatedly lost antitrust lawsuits. We depart from existing competitive models by integrating oligopolistic lenders into a heterogeneous agent, defaultable debt framework. Our model accounts for 20 to 50 percent of the spreads observed in the data. Welfare gains from competitive reforms in the 1970s are equivalent to a one-time transfer worth between 0.24 and 1.66 percent of GDP. Along the transition path, 93 percent of individuals are better off. Poor households benefit from increased consumption smoothing, while rich households benefit from higher general equilibrium interest rates on savings. Transitioning from 1970 to 2016 levels of competition yields welfare gains equivalent to a one-time transfer worth between 1.87 and 3.20 percent of GDP. Lastly, homogeneous interest rate caps in 2016 deliver limited welfare gains.

February 11, 2020 | Permalink | Comments (0)

Innovate to Lead or Innovate to Prevail: When Do Monopolistic Rents Induce Growth?

Roberto Piazza, International Monetary Fund (IMF) and Yu Zheng, Queen Mary University of London ask Innovate to Lead or Innovate to Prevail: When Do Monopolistic Rents Induce Growth?

ABSTRACT: This paper extends the Schumpeterian model of creative destruction by allowing followers' cost of innovation to increase in their technological distance from the leader. This assumption is motivated by the observation the more technologically advanced the leader is, the harder it is for a follower to leapfrog without incurring extra cost for using leader's patented knowledge. Under this R&D cost structure, leaders innovate to increase their technological advantage so that followers will eventually stop innovating, allowing leadership to prevail. A new steady state then emerges featuring both leaders and followers innovating in few industries with low aggregate growth.

February 11, 2020 | Permalink | Comments (0)

Monday, February 10, 2020

Buyer Power, Upstream Bundling, and Foreclosure

Claire Chambolle, Ecole Polytechnique, Paris - Laboratoire d'Econometrie; National Institute for Agricultural Research (INRA) and Hugo Molina, French National Institute for Agricultural Research (INRA) identify Buyer Power, Upstream Bundling, and Foreclosure.

ABSTRACT: This article provides a new rationale for the "leverage theory" of bundling in vertical markets. We analyze a framework with a capacity-constrained retailer and uncover that buyer power explains the emergence of bundling practices by a multi-product manufacturer to foreclose a more efficient upstream rival. We further show that the retailer may counteract this adverse effect by expanding its stocking capacity and distribute all products to consumers. Finally, our theory highlights that a ban on bundling practices may restore the retailer's incentives to restrict its stocking capacity which generates detrimental effects for welfare.

February 10, 2020 | Permalink | Comments (0)

Digital Disruption in Banking

Xavier Vives, University of Navarra - IESE Business School; Universitat Pompeu Fabra (UPF); Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research) identifies Digital Disruption in Banking.

ABSTRACT: This review surveys technological disruption in banking, examining its impact on competition and its potential to increase efficiency and customer welfare. It analyzes the possible strategies of the players involved—incumbents and FinTech and BigTech firms—and the role of regulation. The industry is facing radical transformation and restructuring, as well as a move toward a customer-centric platform-based model. Competition will increase as new players enter the industry, but the long-term impact is more open. Regulation will decisively influence to what extent BigTech will enter the industry and who the dominant players will be. The challenge for regulators will be to keep a level playing field that strikes the right balance between fostering innovation and preserving financial stability. Consumer protection concerns rise to the forefront.

February 10, 2020 | Permalink | Comments (0)

Event Studies in Merger Analysis: Review and an Application Using U.S. TNIC Data

Timo Klein, University of Amsterdam - Amsterdam School of Economics (ASE) offers Event Studies in Merger Analysis: Review and an Application Using U.S. TNIC Data.

ABSTRACT: There is a growing concern that U.S. merger control may have been too lenient, but empirical evidence remains limited. Event studies have been used as one method to acquire empirical insights into the competitive effects of mergers. However, existing work suffers from strong identifying assumptions, unreliable competitor identification or small samples. After reviewing the use and challenges of event studies in merger analysis, I use a novel application of Hoberg-Phillips (2010, 2016) Text-Based Network Industry Classification (TNIC) data to readily proxy a ranking of competitors to 1,751 of the largest U.S. mergers between 1997 and 2017. I document that following a merger announcement, the most likely competitors experience on average an abnormal return of around one percent. These abnormal returns are also associated with concerns of market power, which suggests that results are at least in part driven by an anticipation of anti-competitive effects, and hence insufficient merger control.

February 10, 2020 | Permalink | Comments (0)

Probability, Presumptions and Evidentiary Burdens in Antitrust Analysis: Revitalizing the Rule of Reason for Exclusionary Conduct

Andrew I. Gavil, Howard University School of Law and Steven C. Salop, Georgetown University Law Center explore Probability, Presumptions and Evidentiary Burdens in Antitrust Analysis: Revitalizing the Rule of Reason for Exclusionary Conduct.

ABSTRACT: The conservative critique of antitrust law has been highly influential and has facilitated a transformation of antitrust standards of conduct since the 1970s and led to increasingly more permissive standards of conduct. While these changes have taken many forms, all were influenced by the view that competition law was over-deterrent. Critics relied heavily on the assumption that the durability and costs of false positive errors far exceeded those of false negatives.

Many of the assumptions that guided this retrenchment of antitrust rules were mistaken and advances in the law and in economic analysis have rendered them anachronistic, particularly with respect to exclusionary conduct. Continued reliance on what are now exaggerated fears of “false positives,” and failure adequately to consider the harm from “false negatives,” has led courts to impose excessive demands of proof on plaintiffs that belie both established procedural norms and sound economic analysis. The result is not better and more reasonable antitrust standards, but instead an embedded ideological preference for non-intervention that creates a tendency toward false negatives, particularly in modern markets characterized by economies of scale and network effects.

In this article, we explain how these erroneous assumptions about markets, institutions, and conduct have distorted the antitrust decision-making process and produced an excessive risk of false negatives in exclusionary conduct cases involving firms attempting to achieve, maintain, or enhance dominance or substantial market power. To redress this imbalance, we integrate modern economic analysis and the teaching of decision theory with the foundational conventions of antitrust law, which has long relied on probability, presumptions, and reasonable inferences to provide more effective means for evaluating competitive effects and resolving antitrust claims.

February 10, 2020 | Permalink | Comments (0)

Sunday, February 9, 2020

Deputy Assistant Attorney General Richard A. Powers Delivers Remarks on the State of Criminal Antitrust Enforcement in 2020

See here.

February 9, 2020 | Permalink | Comments (0)

Saturday, February 8, 2020

The most important things I learned from GCR Live Miami yesterday (on non-antitrust issues)

  • GCR Live Miami has the most in shape people in the antitrust community of any conference - lots of avid runners and some super buff or super toned people
  • Diana Moss (AAI) is a metal-head
  • Jeremy Calsyn (Cleary) has played basketball with Jay-Z and George Clooney
  • It is possible to have a panel with 4 of 5 panelists at 6'3 or over
  • Jason Gudofsky (McCarthy) is an Ironman triathlete
  • Richard Powers (DOJ) served in the US army in Iraq
  • The Popeye's fried chicken sandwich seems to be a guilty pleasure of a number of conference participants
  • Netflix Belgium seems to be particularly bad in terms of quality of movies and shows and Netflix Singapore amazing (and hence there is lots of interesting VPN arbitrage going on) 
  • Most interesting person who I met for the first time at GCR: Patricia Vidal,Uría Menéndez (Madrid)

February 8, 2020 | Permalink | Comments (0)

Friday, February 7, 2020

The Impact of Consumer Multi-homing Behavior on Ad Prices: Evidence from an Online Marketplace

Yu-Hsin Liu, Facebook discusses The Impact of Consumer Multi-homing Behavior on Ad Prices: Evidence from an Online Marketplace.


This study examines the trade-off between online advertising effectiveness and (do-not-track) privacy regulation. Recent literature on ad-financed business model predicts that consumers who patronize multiple platforms (multi-homing) can have less per-impression value as they may see duplicated ads from multiple sources. The use of tracking technology in the digital space may however eliminate the redundant ad provision at the expense of consumer privacy. The presenting paper provides the first empirical evidence on whether multi-homer’s attention is less valuable in online media market, under FTC’s privacy regulation on tracking. The paper then discusses the potential market outcome if the privacy regulation were removed. The publisher ad data is scraped from BuySellAds and matched with comScore 2016 for consumer multihoming behavior. The study employed a quasi-experiment based on ad location in a webpage to identify the multi-homing effect on ad prices. By finding that the marginal effect of multi-homing (treatment) on ad prices is indeed more negative for the more viewable ads (treated), the paper concludes that consumer multi-homing behavior can increase the tendency of over impressions, and such tendency can decrease advertisers’ valuation of ad slots in the digital display ad market.

February 7, 2020 | Permalink | Comments (0)

The Failure of Free Entry

German Gutierrez Gallardo, New York University (NYU) - Leonard N. Stern School of Business, Students and Thomas Philippon, New York University (NYU) - Department of Finance; National Bureau of Economic Research (NBER) suggest The Failure of Free Entry.

ABSTRACT: We study the entry and exit of firms across U.S. industries over the past 40 years. The elasticity of entry with respect to Tobin's Q was positive and significant until the late 1990s but declined to zero afterwards. Standard macroeconomic models suggest two potential explanations: rising entry costs or rising returns to scale. We find that neither returns to scale nor technological costs can explain the decline in the Q elasticity of entry, but lobbying and regulations can. We reconcile conflicting results in the literature and show that regulations drive down the entry and growth of small firms relative to large ones, particularly in industries with high lobbying expenditures. We conclude that lobbying and regulations have caused free entry to fail.

February 7, 2020 | Permalink | Comments (0)

The Theory of Granularity: A Path for Antitrust in Blockchain Ecosystems

Thibault Schrepel, Harvard University (Berkman Center); Utrecht University School of Law; University Paris 1 Panthéon-Sorbonne provides The Theory of Granularity: A Path for Antitrust in Blockchain Ecosystems.

ABSTRACT: Modern antitrust and competition law relies extensively on the firm as defined by Ronald Coase: a hierarchy reducing transaction costs thanks to vertical control, where such control defines the firm’s boundaries. Meanwhile, the governance of public permissionless blockchains is horizontal. Transaction costs are minimized thanks to specific characteristics that are singular to these blockchains and do not depend on the verticality of relationships. The absence of vertical control to direct the resources holds antitrust and competition in check.

February 7, 2020 | Permalink | Comments (0)

Thursday, February 6, 2020

Interview with Enforcers: Discussing the Vertical Merger Guidelines Draft

Interview with Enforcers: Discussing the Vertical Merger Guidelines Draft

Please join us for an interview with FTC Commissioner Christine Wilson, Principal DAAG Bernard Nigro, and DOJ Competition Policy & Advocacy Section Chief David Lawrence to discuss the new draft Vertical Merger Guidelines.


  • Christine Wilson, Federal Trade Commission Commissioner
  • Bernard Nigro, Depatment of Justice
  • David Lawrence, Department of Justice


  • Koren Wong-Ervin, Qualcomm Inc.
  • Renata Hesse, Sullivan and Cromwell


February 10, 2020 noon-1:15p.m. Eastern


February 6, 2020 | Permalink | Comments (0)

Restrictions of Sport Sponsorship from a Competition Law Perspective—Recent Example from Germany