Showing results for: “loyalty discounts”
Note to the FTC: Punishing Efficiency Means Destroying Competition
Yesterday, Lina Khan’s FTC released their long-awaited draft merger guidelines for public comment. Regrettably yet not unsurprisingly, the new guidelines are a radical departure from established case law and antitrust thinking. They’re marked by a failure to account for the role of efficiencies in the competitive process, and a failure to distinguish between the implications of generally ... Note to the FTC: Punishing Efficiency Means Destroying Competition
What Is a Barrier to Entry?
Why do monopolies exist? Many textbooks point to barriers to entry as a cause of monopolies. Tyler Cowen and Alex Tabarrok’s textbook says: “In addition to patents, government regulation and economies of scale, monopolies may be created whenever there is a significant barrier to entry, something that raises the cost to new firms of entering the industry.” ... What Is a Barrier to Entry?
The Paradoxical Perils of Mandatory ‘Competition’ in Merchant Routing of Credit-Card Transactions
Sen. Richard Durbin (D-Ill.) earlier this month introduced legislation that aims to manufacture competition in the routing of credit-card transactions. If enacted, the measure would require that merchants be able to choose from at least two networks when processing most credit-card transactions. While this would result in competition over routing, it would harm other forms ... The Paradoxical Perils of Mandatory ‘Competition’ in Merchant Routing of Credit-Card Transactions
FTC v Amgen: The Economics of Bundled Discounts, Part Two
The Federal Trade Commission (FTC) recently announced that it would sue to block Amgen’s proposed $27.8 billion acquisition of Horizon Therapeutics. The challenge represents a landmark in the history of pharmaceutical-industry antitrust enforcement, as the industry has largely been given license to engage in permissive mergers and acquisitions of smaller companies without challenge. In Part One, ... FTC v Amgen: The Economics of Bundled Discounts, Part Two
FTC v Amgen: The Economics of Bundled Discounts, Part One
The Federal Trade Commission (FTC) recently announced that it would seek to block Amgen’s proposed $27.8 billion acquisition of Horizon Therapeutics. The move was the culmination of several years’ worth of increased scrutiny from both Congress and the FTC into antitrust issues in the biopharmaceutical industry. While the FTC’s move didn’t elicit much public comment, ... FTC v Amgen: The Economics of Bundled Discounts, Part One
European Commission’s Leaked SEP Regulation Would Increase Costs for Innovators, Hurt EU Competitiveness, and Fail to Reduce Litigation
The European Commission is working on a legislative proposal that would regulate the licensing framework for standard-essential patents (SEPs). A regulatory proposal leaked to the press has already been the subject of extensive commentary (see here, here, and here). The proposed regulation apparently will include a complete overhaul of the current SEP-licensing system and will ... European Commission’s Leaked SEP Regulation Would Increase Costs for Innovators, Hurt EU Competitiveness, and Fail to Reduce Litigation
Biweekly FTC Roundup: Grail-Shaped Beacon Edition
The lame duck is not yet dead, and the Federal Trade Commission (FTC) is supposed to be an independent agency. Work continues. The Commission has announced a partly open oral argument in the Illumina-Grail matter. That is, parts of the argument will be open to the public, via webcast, and parts won’t. This is what’s ... Biweekly FTC Roundup: Grail-Shaped Beacon Edition
7 Big Questions About the Open App Markets Act
With just a week to go until the U.S. midterm elections, which potentially herald a change in control of one or both houses of Congress, speculation is mounting that congressional Democrats may seek to use the lame-duck session following the election to move one or more pieces of legislation targeting the so-called “Big Tech” companies. ... 7 Big Questions About the Open App Markets Act
Doubling Down on Durbin Disaster: Interchange Fee Caps Shortchange Consumers
The U.S. economy survived the COVID-19 pandemic and associated government-imposed business shutdowns with a variety of innovations that facilitated online shopping, contactless payments, and reduced use and handling of cash, a known vector of disease transmission. While many of these innovations were new, they would have been impossible but for their reliance on an established ... Doubling Down on Durbin Disaster: Interchange Fee Caps Shortchange Consumers
Rebuilding Trust in Coronaworld
Governments are beginning to lift the lockdowns they imposed to slow the spread of COVID-19. That is a good thing. But simply lifting the restrictions won’t immediately take us back to normality. For that to happen requires a massive investment in mechanisms that will rebuild trust. Prior to COVID-19, people implicitly trusted that travelling on ... Rebuilding Trust in Coronaworld
Brennan: Guidance on Enforcement Against “Pure” Vertical Mergers: It’s Complicated
[TOTM: The following is part of a symposium by TOTM guests and authors on the 2020 Vertical Merger Guidelines. The entire series of posts is available here.] This post is authored by Timothy J. Brennan (Professor, Public Policy and Economics, University of Maryland; former Chief Economist, FCC; former economist, DOJ Antitrust Division).] The DOJ Antitrust ... Brennan: Guidance on Enforcement Against “Pure” Vertical Mergers: It’s Complicated
Mr. Watson, I Want to See You … About Vertical Mergers and Price Regulation
Jonathan B. Baker, Nancy L. Rose, Steven C. Salop, and Fiona Scott Morton don’t like vertical mergers: Vertical mergers can harm competition, for example, through input foreclosure or customer foreclosure, or by the creation of two-level entry barriers. … Competitive harms from foreclosure can occur from the merged firm exercising its increased bargaining leverage to ... Mr. Watson, I Want to See You … About Vertical Mergers and Price Regulation
