In antitrust’s division of labor, lawyers care a great deal about who wins and who loses cases and why. Economists are not disinterested in these matters, but they care as much if not more about what happens after an antitrust case has been decided or settled. Economists ask: what are the benefits and costs of the antitrust remedy?
The primary objective of any antitrust remedy is to halt the defendant’s anticompetitive behavior so consumers can enjoy the benefits of competition. The bottom line of any assessment of the effects of an antitrust remedy should be its effect on consumer welfare. In the entire corpus of antitrust scholarship, only a small portion has been concerned with the “back-end” of antitrust enforcement. Some of this attention has been devoted to structural relief. Elzinga offered the first economic assessment of divestiture under the amended antimerger law. This assessment was updated by a study from the Federal Trade Commission. More recently, Crandall presented a critical empirical assessment of Sherman Act structural remedies.
While the popular image of the Sherman Act is that of a “trust-busting” statute, conduct remedies have been more common than structural remedies. This paper evaluates the effect on economic welfare of conduct remedies that have resulted from a sample of Sherman Act monopolization cases.