Do you guys think antitrust law needs to adapt to digital markets?
For the last few decades, antitrust policy relied largely on the Chicago school of thought. The main goal of antitrust is promoting alocative efficiency, which is (according to the Chicago School) the best way to expand and protect consumer welfare.
However, the popularization of digital and multi-sided markets have brought new challanges to the table. The interaction between the two sides of the same market, for example, puts a lot of strain on our current tools for determining the relevant market (which antitrust analysis relies heavily upon).
The prevalance of network effects may contribute to the creation of barriers of entry, reducing overall competitiveness. When a new firm manages to change the competitive dynamic in those markets, incumbent firms try to buy out the competition, in what is known as a “killer acquisition”.
“Zero-price” markets makes much of our tools obsolete, since their application depends on the analysis of price variation. To mitigate this, antitrust agencies around the world begun to supplement their analytical tools with new, novel theories of harm. While this approach has been somewhat succeful, these new theories are still in their infancy.
Current academic research suggest that, while the main premises of antitrust remain solid, our current approach to regulating digital multi-sided markets is insufficient to prevent anticompetitive practices and market power abuse by incumbent firms.
So my question is: do you believe antitrust is in need of change? If so, how can we adapt it to the digital era while preserving libertarian values?
PS: Sorry for any mistakes. English isn’t my first language.
submitted by /u/victort4
Article from r/Libertarian: For a Free Society