Oligopolistic Conduct

Richard S. Markovits ()
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Richard S. Markovits: University of Texas School of Law

Chapter Chapter 9 in Welfare Economics and Antitrust Policy - Vol. I, 2021, pp 179-291 from Springer

Abstract: Abstract This chapter focuses on “oligopolistic conduct.” In my terminology, “oligopolistic conduct” references all conduct that results from an actor’s making a decision it would not have found ex ante profitable had it not believed ex ante that one or more of its rivals’ responses would or might be affected by the rival’s/rivals’ perception that the perpetrator would or might react to its/their responses. Oligopolistic conduct can either be “contrived” or “natural,” depending on whether its initiator induced its rival’s/rivals’ expectation that it would or might react to its/their response(s) by communicating its intention to retaliate against its/their non-cooperation and/or to reciprocate to their cooperation. This chapter contains five sections, each of which focuses on one category of oligopolistic conduct. This chapter argues that virtually all exemplars of all types of oligopolistic conduct other than oligopolistic conduct that increases the economic efficiency of its participants’ investment-location decisions decrease economic efficiency, that (with the above exception) all contrived-oligopolistic conduct and (admittedly contestably) all natural-oligopolistic conduct are liberal-moral-rights-violative, and that (with that exception) virtually all oligopolistic conduct decreases total utility and disserves the instantiation of all non-utilitarian-egalitarian conceptions of the moral good. This chapter also explains the difficulty of proving that firms have engaged in oligopolistic conduct and examines the implications of this fact for the ability of government to increase economic efficiency, protect liberal moral rights, and instantiate various conceptions of the moral good by deterring and punishing oligopolistic conduct and giving its victims an appropriate opportunity to obtain legal redress.

Date: 2021
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DOI: 10.1007/978-3-030-79812-3_9

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