tailieunhanh - Lecture Economics (18th edition): Chapter 18 - McConnell, Brue, Flynn's

Chapter 18 - Antitrust policy and regulation. In this chapter, students will be able to understand: List and explain the core elements of the major antitrust (antimonopoly) laws in the United States, describe some of the key issues relating to the interpretation and application of antitrust laws, identify and explain the economic principles and difficulties relating to the setting of prices (rates) charged by so-called natural monopolies, discuss the nature of "social regulation," its benefits and costs, and its optimal level. | Antitrust Policy and Regulation Chapter 18 McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter Objectives Antitrust laws in the United States Interpretation and application of antitrust laws Natural monopolies Social regulation 18- Antitrust Laws The purpose: Prevent monopoly Promote competition Achieve allocative efficiency Historical background Regulatory agencies Antitrust laws 18- Antitrust Laws Sherman Act 1890 Clayton Act 1914 Outlaw price discrimination Prohibit tying contracts No interlocking directorates Federal Trade Commission Act 1914 Wheeler-Lea Act 1938 Celler-Kefauver Act 1950 18- Antitrust Policy Issues of interpretation Monopoly behavior or structure 1911 Standard Oil Case 1920 . Steel Case 1945 Alcoa Case The relevant market 1956 DuPont Cellophane Case Issues of enforcement 18- Effectiveness of Antitrust Laws Monopoly Microsoft Case Mergers Horizontal merger Vertical merger Conglomerate merger 18- Types of Mergers Automobiles Blue Jeans Autos Glass Blue Jeans Denim Fabric A C B D E F Z Y X W V U T Horizontal Merger Conglomerate Merger Vertical Merger 18- Merger guidelines The Herfindahl Index Price fixing Price discrimination Tying contracts Effectiveness of Antitrust Laws 18- Natural Monopoly Economies of scale Public utilities Electricity, water, gas, phone Solutions for better outcomes Public ownership Public regulation Public interest theory of regulation 18- Industrial Regulation Regulators establish rates to give natural monopoly “fair return” No incentive to reduce cost X-inefficiency Perpetuate monopoly Conditions of natural monopoly can end 18- Social Regulation Applies “across the board” to all industries Food and Drug Administration 1906 Equal Employment Opportunity Commission 1964 Occupational Safety and Health Administration 1971 Environmental Protection Agency 1972 Consumer Product Safety Commission 1972 18- Social Regulation Optimal level . | Antitrust Policy and Regulation Chapter 18 McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter Objectives Antitrust laws in the United States Interpretation and application of antitrust laws Natural monopolies Social regulation 18- Antitrust Laws The purpose: Prevent monopoly Promote competition Achieve allocative efficiency Historical background Regulatory agencies Antitrust laws 18- Antitrust Laws Sherman Act 1890 Clayton Act 1914 Outlaw price discrimination Prohibit tying contracts No interlocking directorates Federal Trade Commission Act 1914 Wheeler-Lea Act 1938 Celler-Kefauver Act 1950 18- Antitrust Policy Issues of interpretation Monopoly behavior or structure 1911 Standard Oil Case 1920 . Steel Case 1945 Alcoa Case The relevant market 1956 DuPont Cellophane Case Issues of enforcement 18- Effectiveness of Antitrust Laws Monopoly Microsoft Case Mergers Horizontal merger Vertical merger Conglomerate merger