The Dual Antitrust Enforcement Question

Cite this Article
Josh Wright, The Dual Antitrust Enforcement Question, Truth on the Market (March 31, 2008),

With all of the recent talk of the “optimal regulatory structure” and proposals about regulatory consolidation and reorganization (here is Glom Blogger David Zaring on the Big Reorg), I wonder if the discussion might carry over into antitrust and the recurring “dual enforcement” question. 

As some of our readers may know, both the DOJ and FTC share the responsibility of enforcing the federal antitrust laws.  This dual agency structure comes under attack from time to time.  As one might expect, the primary critique is that the dual structure creates inconsistent enforcement and other inefficiencies.  However, the consensus view appears to be that the institutions have evolved in ways that mitigate those inefficiencies.  At least, the agencies have reduced these inefficiencies to the point that there is apparently no constituency harmed by them sufficiently to create a large demand for reform.  Judge Posner describes the structure as “peculiar, to say the least … yet pretty harmless.”  The Antitrust Modernization Committee recently took on the issue of dual enforcement (Chapter II.A) and concluded that while “although concentrating enforcement authority in a single agency generally would be a superior institutional structure, the significant costs and disruptions of moving to a single-agency system at this point in time would likely exceed the benefits.”  In other words, if it ain’t broke (or is only broke a little bit) … It should be noted that three AMC Commissioners did recommend consolidation of all antitrust enforcement powers with the DOJ.

The discussion of benefits and costs of regulatory competition and consolidation in antitrust has been largely anecdotal.  For example, Judge Posner draws on his own experiences with state AGs (read: bad ones), though he does marshal some other evidence, in arguing that states should be stripped of their antitrust enforcement powers except for under narrow circumstances.  I think it is a fairly open empirical question whether and to what extent regulatory competition between federal agencies (or federal agencies and the state AGs)  has been a net good or bad for consumer welfare.   If any rigorous empirical work has been done on this question in antitrust, I haven’t seen it or have forgotten it.  My instinct is that the evidence is likely to differ in those two cases with state v. federal overlapping enforcement generating larger and more robust negative effects (and little or no effect as between the federal agencies).