You Say You Want an Antitrust Revolution? The Paradox of Modern Merger Control

• Author: John Kwoka
• Published date: 01 December 2020
• Date: 01 December 2020
• DOI: http://doi.org/10.1177/0003603X20950201

Article

You Say You Want an Antitrust

Revolution? The Paradox of

Modern Merger Control

John Kwoka*

Abstract

Over the past twenty years, merger control has made what appear to be substantial advances in

concepts and methodology, claiming the mantle of a “revolution.” This essay observes, however, that

over this very same time period, merger control has in fact weakened and concentration risen

throughout the economy. It reexamines two of the most heralded new methodologies—market

definition and unilateral effects. It shows ways in which these have had the paradoxical effect of actually

weakening merger control rather than strengthening it.

Keywords

antitrust, mergers

I. Introduction

Some thirty years ago, modern economics began to play an increased role in antitrust analysis. The

older legalistic and formalistic approach, especially with respect to mergers, had come under mounting

criticism from the Chicago School and other perspectives. Noneconomic objectives for policy came to

be viewed more skeptically. Insightful analyses of regulation and deregulation increasingly encour-

aged economists to turn their attention antitrust policy. And indeed, over the next many years, a

remarkable number of new concepts and methods for antitrust analysis have been developed.

For mergers, these new developments included a novel measure of concentration, a new method for

defining antitrust markets, the theory of unilateral effects and diversion analysis, bargaining models,

criteria for cognizable efficiencies, new types and uses of remedies, and a variety of important

empirical techniques. These were heralded for the insights they brought, the precision with which

they focused on key issues, and the degree to which they made concepts operational. A comparison of

the original 1968 Horizontal Merger Guidelines, or even those of 1982, with the current version (the

2010 revision) of the Merger Guidelines reflects these profound changes—an intellectual and policy

revolution—in antitrust economics over this period.

* Northeastern University, Boston, MA, USA

Corresponding Author:

John Kwoka, Northeastern University, 360 Huntington Ave., Boston, MA 02115, USA.

Email: j.kwoka@northeastern.edu

The Antitrust Bulletin

2020, Vol. 65(4) 568–578

ªThe Author(s) 2020

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DOI: 10.1177/0003603X20950201

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