Our series–Back to Basics–explains American antitrust law in plain English. Here, you’ll find everything you need to know about the current law and its history, a few “fun” anecdotes, and analysis of proposed reforms.
Learn Through Back to Basics: American Antitrust Explained Here
The last thing America should do is follow in the footsteps of the U.K. or European Union, whose barriers to innovation have prevented the growth of successful technology businesses. Spotify is the only leading global internet firm to have emerged from Europe.
Almost 100 years ago, America tried the European approach, but we soon realized the “ask first, innovate later” approach hampered growth and competition. Instead, America has focused on protecting consumers and encouraging competition.
Today’s antitrust regime is not perfect, but it reflects a century-plus of accumulated wisdom to promote America’s global competitiveness and consumer well-being.
In the United States, our free markets set prices for goods and services. Consumers benefit from how market competition enables lowered prices and improved product quality. Competition also keeps businesses on their toes, encouraging them to innovate and create new products.
Sometimes, a single business or two gains control of the entire market for a product or service and takes anticompetitive steps to benefit at consumers’ expense. They might collude to set prices higher than they’d ordinarily be, or they might tie products together so that consumers have to buy Product B even if they want only Product A.
The most common consumer harms of such anticompetitive conduct are higher prices, reduced output, and stagnant or lower-quality products.
To prevent or remedy these harms, we have antitrust law. Our enforcement agencies focus on restoring competition in the market so that prices, quality, and innovation reflect the market’s actual dynamics, not a monopolist’s corrupted market.
