Professor Tim Wu Makes The Case Against Antitrust Policy

It is common to hear proponents of antitrust action against big tech firms talk up the potential for  future harms to consumers from sustained dominance by Facebook, Google, and Amazon. In her influential“Amazon’s Antitrust Paradox,” lawyer Lina Khan argued that “the current market is not always a good indication of competitive harm” and that antitrust authorities should “ask what the future market will look like.” This sentiment was recently echoed by economist Jason Furman ina digital competition review for the UK government.One of the best cases against such an approach was inadvertently delivered by long-time antitrust champion Professor Tim Wu at a Stigler Center conference on antitrust last week. While critiquing the consumer welfare standard approach in a debate with Tyler Cowen,Wu said:everyone who is even vaguely honest as an economist will agree that dynamic costs matter more than static costs and dynamic benefits matter more than static benefits. But those are the hardest to measure, so we ’ve gotten trapped in a world where the old joke about the economist and the street light has become the soul of the law.Exactly. Antitrust policy can indeed tend to think of markets too statistically. But antitrust enforcers also have no special insight into the future of markets and available technologies, and hence the change in the balance of costs and benefits to consumers going forwards.  Looking at a static market may well lead to mistaken conclusions. ...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs