Antitrust in the Not-for-Profit Sector

Tomas Philipson and Richard A. Posner

Journal of Law & Economics, 2009, vol. 52, issue 1, pages 1-18

Abstract: Although the not-for-profit sector contributes greatly to aggregate output in many industries, there has been little explicit analysis of the economic consequences of applying antitrust policy in this sector. Despite the differences between for-profit and nonprofit firms stressed in conventional economic analyses, U.S. antitrust law generally does not distinguish between these two organizational forms. This paper argues that, under plausible assumptions and with possible exceptions, the same incentives to restrain trade exist in the nonprofit sector as in the for-profit sector. Altruistic firms benefit from exploiting market power, even when they would price below cost in the absence of competition. In fact, the efficiency gains from antitrust policy may often be larger for nonprofit firms. Therefore, a policy of promoting competition has social value even when producers' motivations are altruistic. The argument for uniform antitrust treatment of the two sectors extends to exemptions from antitrust law as well. (c) 2009 by The University of Chicago. All rights reserved..

Date: 2009

Downloads: (external link)
http://www.journals.uchicago.edu/doi/pdf/10.1086/589704 link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Antitrust in the Not-For-Profit Sector (2006)
Working Paper: Antitrust and the Not-For-Profit Sector (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ucp:jlawec:v:52:y:2009:i:1:p:1-18

Ordering information: This journal article can be ordered from
http://www.journals.uchicago.edu/JLE/order1.html

Access Statistics for this article

Journal of Law & Economics is edited by Dennis W. Carlton, Austan Goolsbee, Randall S. Krosner, Douglas Lichtman and Edward A. Snyder

More articles in Journal of Law & Economics from University of Chicago Press
Address: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637
Series data maintained by Christopher F. Baum ().