Skip to main content

The Surprising Culprit Behind Declining U.S. Antitrust Enforcement

February 20, 2024

Herbert Hovenkamp
Herbert Hovenkamp

Prof. Herb Hovenkamp argues that small businesses and trade associations have historically had more influence over antitrust policy, often lobbying for less competition and higher prices.

At ProMarket, Herb Hovenkamp, James G. Dinan University Professor at the University of Pennsylvania Carey Law School, argues that contrary to a recent article’s assertion that the political influence of big business has led to a decline in antitrust enforcement, historically, small businesses and trade associations have had more influence over antitrust policy.

“[T]he history of the relationship between antitrust policy and interest groups has not been pretty,” writes Hovenkamp, “but big business is hardly the worst offender.”

As a Penn Integrates Knowledge (PIK) Professor with appointments in Wharton and the Law School, Hovenkamp works at the intersection of antitrust law, legal history, business, patents, and innovation.

Called “the dean of American antitrust law” by The New York Times in 2011, Hovenkamp is a Fellow of the American Academy of Arts and Sciences, and in 2008, he won the Justice Department’s John Sherman Award for his lifetime contributions to antitrust law. In 2012, he served on the ABA’s Committee to advise the President-elect on antitrust matters.

From ProMarket:

In their recent Antitrust Law Journal article, Filippo Lancieri, Eric Posner, and Luigi Zingales (“LPZ”) explore why antitrust policy is less aggressive today than two generations ago. They argue that academic thought, such as the rise of the Chicago School, has had relatively little influence, which will surprise its critics. Nor does the decline respond to changes in public opinion, as most of the decisions leading to the decline were made by judges or other unelected officials, and much of it was not transparent to the public. Rather, the authors argue that an important cause of antitrust’s decline has been the political influence of “big business.” Further, while the arguments for reduced antitrust enforcement were articulated as promotion of economic growth, it has not succeeded in producing that result.

The LPZ article should be read as a contribution to a many-decades-long broader literatureon who controls policy decisions in a complex democratic society. This debate occasionally includes antitrust policy. Debating the policy impact of diverse democratic pressures, including interest groups and lobbying, legislation, judicial decision-making and popular voting, will likely continue without end. One recent study suggests that experts and interest groups have roughly equal influence over policy, but that the opinions of ordinary citizens carry little weight. Another concludes that there is no empirical support for a link between lobbying and big business concentration. In all events, placing too much weight on any single group or institution is dangerous. LPZ hope to provide a rough metric for weighing these influences in antitrust policy… .

Read Hovenkamp’s full piece at ProMarket.