Antitrust Enforcement as Federal Policy to Reduce Regional Economic Disparities

AuthorRobert Manduca
Published date01 September 2019
Date01 September 2019
Subject MatterPrescriptions: Jobs, Wages, and Regional Development
156 ANNALS, AAPSS, 685, September 2019
DOI: 10.1177/0002716219868141
Enforcement as
Federal Policy
to Reduce
868141ANN The Annals of the American AcademyAntitrust to reduce Regional Economic Disparities
Regions of the United States have seen their incomes
diverge dramatically over the last four decades. This
article makes the empirical and political case for treat-
ing regional economic disparities as a national phenom-
enon best resolved through federal policy, rather than
exclusively as a matter of local responsibility. It then
considers reinvigorated antitrust enforcement as an
example of a federal policy that would strengthen local
economies while benefiting from policy feedback
Keywords: inequality; regional disparities; antitrust;
policy feedbacks
The last 40 years have seen a dramatic wid-
ening of economic disparities between
regions of the United States. A handful of rich
coastal metros have seen their incomes grow
substantially, while large regions of the country
struggle with unemployment and stagnation.
This regional inequality is uniquely consequen-
tial for U.S. politics because political power is
distributed geographically, meaning that unlike
other social groups, struggling places are guar-
anteed to keep their representation.
In this article, I argue that rising regional
inequality should be thought of first and fore-
most as a consequence of national economic
policy—that is, it stems from political decisions
made at the federal level. In addition to being
an accurate reflection of the forces that have
buffeted many parts of the United States since
1980, this framing will help to generate the
political will to address regional divergence,
particularly from within struggling regions
Robert Manduca is a PhD candidate in Sociology
and Social Policy and a doctoral fellow in the
Multidisciplinary Program in Inequality and Social
Policy at Harvard University.
Second, I explore the policy feedback dynamics in one national policy area
with important regional implications: antitrust enforcement. There is a grow-
ing movement to strengthen antitrust policy in light of rapid corporate consoli-
dation in recent years. Here I describe why antitrust enforcement has
important implications for regional economies and how a new antitrust regime
could benefit from policy feedback effects that would help to entrench and
expand its impact once established. I also highlight some advantages that may
make antitrust enforcement easier to enact than other federal regional devel-
opment policies, as well as some strategic considerations in the initial
The Geographic Concentration of Prosperity
One of the most wrenching social and economic shifts to hit the United States
over the past 40 years has been the geographic concentration of prosperity.
Since 1980, the income gap between the richest and poorest regions of the
country has widened by 50 percent, a reversal of more than 100 years of eco-
nomic convergence (Ganong and Shoag 2017). A handful of metro areas have
seen concentrations of wealth almost unprecedented in human history, while a
much larger set has seen their jobs evaporate and their economic bases con-
tract. In addition to the direct economic pain this causes, it likely contributes
to family instability (Autor, Dorn, and Hanson 2017; Wilson 1996), diminished
mobility prospects for children (Sharkey 2013; Sharkey and Faber 2014), and
declining social and political cohesion (Beramendi 2012).
The size of the change is shown in Figure 1, which plots mean family income
by commuting zone (a definition of metro area comprising a central city and sur-
rounding suburban counties) as a fraction of the national mean family income in
1980 and 2013. In 1980, the picture is one of relative consistency across most of
the country. New York (specifically the New Jersey suburbs) and Washington,
D.C., stand out as cities with mean incomes more than 20 percent higher than
the nation as a whole, while rural parts of the Southeast and Southwest had
incomes substantially lower than average. Across the rest of the country, average
incomes fell into a tight band between 80 percent and 120 percent of the national
By 2013, this was no longer true. Most of the East Coast had joined New
York and D.C. in the highest income category, as had northern California and
Minneapolis-St. Paul. At the same time, rural economies across the country
had hollowed out, with most rural parts of the Pacific Northwest, the Midwest,
and California joining those in the Southeast and Southwest in the bottom
income category. In total, whereas just 12 percent of the U.S. population in
1980 lived in commuting zones with mean family incomes more than 20 per-
cent higher or lower than the national average, by 2013 the share had climbed
to 31 percent.

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