We, the undersigned economists, write to express concern regarding the government’s approach toward antitrust and competition policy, embodied most recently in the Federal Trade Commission’s (FTC’s) ongoing investigation of Google. We urge public officials to be wary of antitrust activities that do not focus on real harm to consumers.
America’s business landscape is scarred with numerous antitrust enforcement actions that have: deprived consumers of choices, stripped entrepreneurs of their freedom to innovate, denied workers and shareholders opportunities to build wealth, enriched competitors whose key attribute is political clout, drained “defendant” companies of capital due to legal expenses, and thwarted potential growth in the economy. Indeed, many firms probed under the government’s criteria for “concentration” and other perceived ills have been relegated to much less dominant market players before antitrust proceedings against them were completed.
Whether they have afflicted traditional manufacturers or high-tech firms, antitrust policies have too often failed to recognize the proper limits of government’s role in overseeing competition. The result is an arbitrary, conflicted message to the risk-takers who are crucial to our nation’s economic dynamism at home and abroad: be productive and creative, but not so productive and creative that competitors and bureaucrats find it in their interest to undermine you. As former FTC Chairman Tim Muris noted in The Wall Street Journal in 2010:
Competitor complaints are driving recent EU investigations into companies that include Qualcomm, Google, Oracle and IBM. Competitors can provide valuable information about marketplace realities, but they have every incentive to misuse the government to obtain an advantage that is otherwise unattainable.
Google, with its popular online search engine, is the latest target of regulators claiming to be acting in consumers’ interests, even though barriers to entry into the search market are exceedingly low and Google’s competition is but one click away for online users.
Furthermore, such competition can come from many different directions, not just among similarly structured companies in a given sector. Any search engine’s business model faces competitive challenges not only from other search engines, but also from social networks such as Facebook, mobile-phone applications, and a variety of other advertising platforms.
Perhaps most alarming is the notion that Washington can engineer a “remedy” in this case that is superior to the equilibrium markets will find. There is even discussion over rules dictating how search results “should” appear to a user. Micromanagement to this degree deserves neither a place nor a precedent in our economy.
Regardless of the particular firm under the government’s scrutiny, the harm and uncertainty posed to businesses from excessively broad interpretations of antitrust laws are significant. These destructive and ill-fated actions imperil the economy at an especially delicate and pivotal point in its progress toward recovery. Policymakers should instead deploy their talents on restructuring our broken, burdensome regulatory and fiscal management systems in order to foster strong competition and economic growth into the future.
Sincerely,
The Undersigned*
Donald L. Alexander
Western Michigan University
Howard Baetjer, Jr.
Towson University
Atin Basu
Virginia Military Institute
James T. Bennett
George Mason University
Bruce L. Benson
Florida State University
G. Geoffrey Booth
Michigan State University
Donald J. Boudreaux
George Mason University
Phillip J. Bryson
Brigham Young University
William N. Butos
Trinity College
Bryan Caplan
George Mason University
Barry Chiswick
University of Illinois at Chicago
Lawrence R. Cima
John Carroll University
Philip R.P. Coelho
Ball State University
Robert Collinge
University of Texas at San Antonio
Nicole V. Crain
Lafayette College
Wayne Crews
Competitive Enterprise Institute
Kirby R. Cundiff
Northeastern State University
Antony Davies
Duquesne University
Ronnie H. Davis
Florida Institute of Technology
Clarence R. Deitsch
Ball State University
Jeffrey H. Dorfman
University of Georgia
James R. Edwards
Montana State University – Northern
Frank Egan
Trinity College
Richard E. Ericson
East Carolina University
Frank Falero, Jr.
California State University, Bakersfield
William F. Ford
Middle Tennessee State University
Dave Garthoff
University of Akron
David E.R. Gay
University of Arkansas
Paul J. Gessing
Rio Grande Foundation
Otis W. Gilley
Louisiana Tech University
Micha Gisser
University of New Mexico
Richard Grant
Lipscomb University
Dennis Halcoussis
California State University, Northridge
David L. Hammes
University of Hawaii at Hilo
Stephen Happel
Arizona State University
Ronald M. Harstad
University of Missouri – Columbia
David R. Henderson
Hoover Institution, Stanford University
Bradley K. Hobbs
Florida Gulf Coast University
C. Thomas Howard
University of Denver
James L. Huffman
Lewis & Clark Law School
Jeffrey Rogers Hummel
San Jose State University
Brian J. Jacobsen
Wisconsin Lutheran College
Barry Keating
University of Notre Dame
Daniel Klein
George Mason University
Roger Koppl
Fairleigh Dickinson University
Kishore G. Kulkarni
Metropolitan State College of Denver
Tom Lehman
Indiana Wesleyan University
Stanford L. Levin
Southern Illinois University Edwardsville
Tony Lima
California State University, East Bay
Jody W. Lipford
Presbyterian College
Alan Lockard
St. Lawrence University
Herbert London
Hudson Institute
Edward J. Lopez
San Jose State University
Lawrence W. Lovik
Alabama Policy Institute
Donald L. Luskin
Trend Macrolytics, LLC
R. Ashley Lyman
University of Idaho
Glenn MacDonald
Washington University in St. Louis
D.W. MacKenzie
Carroll College
Yuri N. Maltsev
Carthage College
Henry G. Manne
George Mason University
Michael L. Marlow
California Polytechnic State University
Deryl W. Martin
Tennessee Technological University
Scott E. Masten
University of Michigan
Timothy Mathews
Kennesaw State University
John McArthur
Wofford College
Deirdre McCloskey
University of Illinois at Chicago
Roger E. Meiners
University of Texas at Arlington
J. Wilson Mixon, Jr.
Berry College
Carlisle E. Moody
College of William & Mary
Michael C. Munger
Duke University
George R. Neumann
University of Iowa
Craig Newmark
North Carolina State University
Walton Padelford
Union University
E.C. Pasour, Jr.
North Carolina State University
Mark J. Perry
University of Michigan – Flint
Keith T. Poole
University of California, San Diego
R. David Ranson
H. C. Wainwright & Co. Economics, Inc.
John Rapp
University of Dayton
Nancy Roberts
Arizona State University
Charles K. Rowley
George Mason University
Paul H. Rubin
Emory University
Thomas Rustici
George Mason University
John Rutledge
Rutledge Capital, LLC
Joseph Salerno
Pace University
Richard T. Selden
University of Virginia
Barry J. Seldon
University of Texas at Dallas
Stephen Shmanske
California State University, East Bay
Vlad Signorelli
Bretton Woods Research, LLC
Neil T. Skaggs
Illinois State University
Alan O. Sykes
Stanford University
John A. Tatom
Indiana State University
Richard K. Vedder
Ohio University
Alan Rufus Waters
California State University, Fresno
Christopher Westley
Jacksonville State University
Peter Williams
University of North Alabama
Gary Wolfram
Hillsdale College
Mokhlis Y. Zaki
Northern Michigan University
Richard Zecher
P/E Investments, LLC and Investor Analytics, LLC
Kate Zhou
University of Hawaii at Manoa
Joseph Zoric
Franciscan University of Steubenville
Benjamin Zycher
Manhattan Institute for Policy Research
* Affiliations listed for identification purposes only. Full names, titles, and affiliations are available in attached documents at top of page.