Making Sense of the Antitrust-State Action Doctrine: Balancing Political Participation and Economic Efficiency in Regulatory Federalism

Robert Inman and Daniel L. Rubinfeld
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Robert Inman: University of Pennsylvania
Daniel L. Rubinfeld: University of California, Berkeley

No 1139, Berkeley Olin Program in Law & Economics, Working Paper Series from Berkeley Olin Program in Law & Economics

Abstract: This article examines the problem of designing federalist regulatory policies (in particular, making sense of the current antitrust state action doctrine) from the perspective of a well-articulated theory of federalism respecting the twin values of political participation and economic welfare. The conflict between state and federal regulatory interests has been longstanding in U.S. constitutional history. This conflict has typically been resolved by a Constitutional interpretation in which federal regulations trump their state counterparts -- witness the Supremacy Clause of the U.S. Constitution which resolves conflicts in favor of federal law. At the other extreme, however, has been the "state action" doctrine, which resolves the tension between federal antitrust regulations and the states' sometimes anticompetitive regulation of business activities in favor of the states. Despite this disparity, the Supreme Court has thus far been largely unwilling to undertake a substantive balancing test between such state and federal regulations. This is especially surprising in the realm of antitrust, where federal and state antitrust laws come directly into conflict with state and local economic regulations. Does the present state action doctrine provide the foundation for making good federalism policy? We will argue that it does not. (Texas Law Review, May 1997) Contact the Law and Economics Program at Boalt Hall, UC Berkeley, Berkeley, CA 94720 for a copy of this paper.

Date: 1997-05-30
Note: oai:cdlib1:blewp-1139

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