Working Paper: NBER ID: w16818
Authors: Aaron Edlin; Joseph Farrell
Abstract: Although antitrust courts sometimes stress the competitive process, they have not deeply explored what that process is. Inspired by the theory of the core, we explore the idea that the competitive process is the process of sellers and buyers forming improving coalitions. Much of antitrust can be seen as prohibiting firms' attempts to restrain improving trade between their rivals and customers. In this way, antitrust protects firms' and customers' freedom to trade to their mutual betterment.
Keywords: Antitrust; Competitive Process; Freedom to Trade; Coalitions
JEL Codes: D2; D4; K2; L2; L4; M2
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| freedom to trade (F10) | competitive process (L13) |
| competitive process (L13) | ability of buyers and sellers to form improving coalitions (D43) |
| antitrust laws (K21) | freedom to trade (F10) |
| collusive behaviors (D70) | obstruct competitive process (L49) |
| monopolistic practices (L12) | inhibit competition (L49) |