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This second of a series of seven papers co-authored by M. Nicolas J. Firzli and David Weeks looks at the notions of private markets – PE, VC, private debt and infrastructure – and the "quest for yields" in a low interest rates environment, which where discussed at two recent global conferences organised by the G7 Pensions Summit (G7 P7) and the Singapore Economic Forum (SEF). ESG, impact investing, renewable energy and the notion of green growth are also discussed by the co-authors and other experts, including the Hon. Nick Sherry, fmr. AUS minister of Superannuation & Corporate Law, Nick Silver, chairman, Climate Bonds Initiative (CBI), Michael Dennis, Head, APAC, Alternatives & Cap. Markets, BlackRock, Dr Guan Seng Khoo, Singapore Management University (SMU) and Ingrid Edmund, Columbia Threadneedle Investments (CTI) The notion of financial long-term-ism is considered from the perspective of institutional asset owners, notably in the US, Britain and the European Union (EU), where "pension fund regulation and the structure of the industry [often] puts a premium on liquidity and causes short-termism, at the expense of long-term investment and patient capital.” Australia has seen much interest in privatisation of public functions/assets. This has increased opportunities for private investment in infrastructure. It has, however, raised political discussion about the correct pricing of “monopoly assets”, such as large regional airports and water utilities. The authors also look at some of the recent developments in Canada, China, India and various ASEAN jurisdictions, including Singapore and assess the role played by the city-state in a complex period: "the COVID crisis has accelerated the mutually reinforcing effects of the Age of Empowerment (ESG, Equity and Entrepreneurship/the Venture Capitalist Ethos), the Age of Geoeconomics (intensifying Sino-American coopetition) and Datafied World Economy (Digitalization, Ai, Cybernetics), and Singapore is positioned precisely at the crossroads where these three powerful currents meet.” Some of the financial and geo-economic aspects of the "Post Brexit" era are also analysed. The authors note that HM Government has invited four key maritime powers to join the 47th G7 summit held in Carbis Bay, Cornwall later in the year: Australia, South Korea, India and South Africa, thus "bringing the blue economy to the fore of the global policy agenda".

The separation of powers principle and antitrust both relate to power and notably deal with the concentration of power. Both occupy center stage in our challenging times, but their respective histories differ and their interactions have never been examined. Even though one relates first and foremost to state power and the other to economic power, they may indeed interact in two ways, especially in an era that sees an unprecedented accumulation, by a few firms of the digital economy, not only of economic power but also of political power. On the one hand, separation of powers-type considerations may be used in antitrust matters. The concentration of power in one company, including the power to adopt rules which set standards for an industry and have a broad impact in society, raises questions which are similar to some at the heart of the separation of powers principle. Antitrust may establish requirements for checks and balances within or for a firm. The latter may even have to abandon the control over the content of important principles, rules or codes. On the other hand, the concentration of power in dominant or monopoly firms whose platforms or search engines have become part of the political and electoral process means a partial rethinking of the separation of powers principle. Non-discriminatory access to these firms’ services and products allowing the targeting of voters becomes an important issue in this context. Antitrust may play a role in this respect and help preserve or rebuild some trust in democracy, though this should be considered as one of its rather indirect goals. In this regard, some separation between “data power” and political power may result from the intervention of antitrust authorities. Antitrust may thus contribute to some form of separation of powers in a data era and, ultimately, to trust.

Tea has a significant contribution to households' cash income in the study area. However, decreasing productivity in the sector with price volatility led to a decline in output. Due to this fact, the studies were assessing the production trend with their bottlenecks, and identify the determinant of tea productivity and inefficiency through Cobb Douglas and stochastic frontier model. Qualitative and quantitative type of data from primary and secondary data was used from 135 tea out-growers. Based on the result as we use the 2017/18 production year as a base year, the productivity of tea in 2020 production year is increased by 41.8% as the coverage of land for tea becomes increased by 53.6%. Lack of skill and knowledge (79.2%), lack of training and extension service 90.3%), low productivity (88.1%), the occurrence of pest and disease (80.7%), climate change (80.7%), weak market linkage (88.1%), monopoly market (69.2%, output price fluctuation (88.9%), and lack of centralized processing facilities (80.7%) were the major constraints on the production and marketing activity of tea out-growers in the study area. The result of Cobb Douglas model found that tea productivity was affected by the labor force, fertilizer, land size, and improved seed. While, technical inefficiency of tea production was determined by to level of education, frequency of extension contact, distance to district market, harvesting time, training, and participation to off/non-farm income. So, improving skill and knowledge of farmers through increasing extension service and training, on-time delivery of farm inputs, create market linkage, and improved tea nursery management were some of the recommendations forwarded to reduce tea production and marketing constraints in the study areas.

This paper proposes a general model for describing the equilibrium state of a ride-sourcing market with an arbitrary number of platforms competing with each other. As the number of platforms increases, the market changes from monopoly to duopoly, oligopoly, and finally perfect competition, bringing about two different effects on system efficiency. On the one hand, like other service markets, competition in the ride-sourcing markets prevents a monopolist platform from greedily maximizing its own profit by distorting its operating strategies from socially efficient levels. On the other hand, competition between platforms leads to market fragmentation, thereby increasing matching frictions and passengers’ waiting time. In this paper we develop a game-theoretical model to determine the solutions of a Nash equilibrium in a competitive ride-sourcing market, at which no platform can increase its profits by unilaterally changing its own strategy. Then we try to quantify the price (efficiency gain or loss) of competition and fragmentation by establishing an upper bound of the inefficiency ratio, i.e., the ratio of social welfare under a social optimum to social welfare under a competitive Nash equilibrium. We show that the results of market equilibrium, including the inefficiency ratio, are jointly governed by the degree of market fragmentation and competition among platforms. In particular, we find that some key market measures, such as consumer surplus, platform profits, social welfare, display diverse trends of changes with respect to the number of platforms, as the matching technology exhibits increasing, constant, and decreasing returns to scale.

Over the past several decades, the six member countries of the Gulf Cooperation Council (GCC) have implemented economic policies for industrial diversification to lessen severe dependence on the oil industry. Such policy efforts have been driven by their awareness of macro-economic and structural risks from heavy volatilities in international oil markets in terms of fiscal and trade sectors. For instance, the drop in international oil prices reduces export performance in the oil and natural gas sectors, which in turn results in a decline in the stability of fiscal revenue. The recent trends of low oil prices since 2014, as well as high unemployment rates, have strengthened the policy regime for industrial diversification and job creation supported by mid- to long-term economic plans of the GCC countries. This report reviews what has been emphasized in the areas of industrial, employment, trade and investment policies. We then derive implications for Korean companies and policymakers for sustainable cooperation between Korea and the Middle East.

The American Antitrust Institute (AAI) has released the White Paper, Update on Digital Technology: The Failure of Merger Enforcement and Need for Reform. The new White Paper updates and expands on analysis AAI originally released in July 2019. The widely cited 2019 AAI White Paper, The Record of Weak U.S. Merger Enforcement in Digital Technology, was the subject of AAI testimony before the Senate Judiciary Committee and drew attention to the acquisitive history of the five largest multinational online service or computer hardware or software companies: Amazon, Apple, Facebook, Google, and Microsoft (“Big Tech”). It also unpacked the history of merger enforcement under Section 7 of the Clayton Act in a major segment of the digital technology sector. The White Paper concluded that, as compared to enforcement across all sectors, the rate of merger challenges in digital technology is exceptionally low. Since then, much has happened in the digital technology sector. Big Tech has solidified its hold on the top-most slots, by market value, in the Fortune 500. Federal and state monopolization cases have been filed against Google and Facebook. Among other things, the Facebook complaints allege that acquisitions of small rivals, such as social media firms Instagram (2012) and WhatsApp (2014), were a strategy to snuff out potential competition to maintain a monopoly in personal social networking services. The public policy debate over the dominance of Big Tech has also generated numerous proposals to remedy competitive and consumer harm, including breakups and digital market regulation. A 2020 House Judiciary Committee report examined competitive issues raised by the platforms that are at the core of many of the large digital ecosystems. Moreover, the digital ecosystems have been the subject of ongoing economic, business, and policy research, which has advanced the state of thinking over potential policy solutions to the problems they raise. Results of AAI’s updated analysis indicate that expansion by acquisition continues to be a leading method by which the large digital ecosystems grow. Enforcers can expect to see further growth that, when juxtaposed with persistent, weak merger enforcement in the sector, will likely exacerbate competition problems. Indeed, stronger merger enforcement over the last two decades would have mitigated the monopolization concerns that AAI sees now. As it stands, however, Section 2 of the Sherman Act is virtually the only antitrust tool left to combat dominance in the digital technology sector. This White Paper turns first to updating data on acquisitions by Big Tech through 2020 and merger enforcement statistics through the latest available reporting year, 2019. It then examines the implications of Big Tech’s likely trajectory of further expansion through acquisition and growth in critical cloud infrastructure capability. It closes with an analysis of reforms necessary to revitalize merger enforcement in digital technology.

This article explains an IP waiver will have a limited impact on meeting the emergency medical requirements. That being so why are countries like India and South Africa putting extreme diplomatic efforts to succeed in this Patent waiver initiative? There is no clear answer. I tempt believe, more than seeking an immediate relief, it is an apostolic behaviour towards this rotten IP regime. I wish it leads to a larger debate on Intellectual Property rights and inequities of the IP regime and the TRIPs agreement. Many, including me, believe that the TRIPS agreement merely provided an advantage to industrialized countries. It has only helped in intellectual colonisation. TRIPs enslaved poor and underdeveloped countries and consistently made them dependant on the mercy of larger industrialized economies for technologies. It retarded innovation in less privileged economies. The current patent system is facilitating the evergreening of patent protection. Creating patent thickets, pooling the patents, generating unfair advantage for themselves and depriving an equal opportunity to new entrants and startups. Many say that the duration of a patent granted is more than what is proportionate to the economic value of the effort. We need to remember that patent as a concept evolved as a reward for disclosure for facilitating further innovation. However, over a period of time, it has become a tool to impose monopoly and prevent competition. In many sectors, technology becomes obsolete in less than five years and granting a patent for 20 years is merely helping to prevent new technology innovations. Yes, discussion on patent waiver helps in creating a platform for discussion for overhauling the IP regime. If that is the real intent, then worth appreciation on that count.

Universal demand (UD) laws impose obstacles on shareholders who wish to file derivative lawsuits. In this paper, we examine the negative consequences of the staggered adoption of UD laws: threatening employee safety. Using the workplace safety data from OSHA, we find that firms experience a 27% increase in employee injuries following the adoption of UD laws, especially for those launching new products or taking risky investments. Besides, we show that the negative effect is also significantly asymmetric: firms with weaker labor unions or establishments located in low-income counties exhibit a greater increase in employee injuries. Such an asymmetric effect is likely driven by firms’ monopoly power in the labor market. Finally, we reveal that adoption of UD law leads to deterioration in integrity-related culture and reductions in organization capital.

Network externalities—i.e., effects on consumers' alternative-specific pay-offs of other consumers' decisions—arise in many economic settings. This paper considers the identification of discrete-choice models featuring network externalities and then uses such a model to analyze how network externalities in the market for dating websites in the United States contribute to the effects of consolidation in that industry. My identification analysis shows that discrete-choice models with network externalities are generally not identified with market-level data alone, but that microdata allows the researcher to construct instrumental variables that identify the model. Using rich online browsing data, I estimate a model of consumer choice of dating website and find evidence of considerable network externalities. In my preferred specification, an inframarginal user of a site values a 10% increase in the site's usership at $11.11/month, which is about one third of the most popular site's price. I use my estimates to assess whether the observed extent of network externalities imply that increased market concentration would benefit consumers. I find that welfare losses from decreased variety and increased prices outweigh the gains from network externalities associated with a move from the observed market structure to monopoly. Platform differentiation may explain why platform integration has not followed consolidation in the dating websites industry.

This paper studies the transition from monopoly by a public firm to mixed duopoly, in which public firm and private firm have heterogeneous objective functions, in the context of Taiwanese wholesale gasoline market. Under a price-setting Stackelberg mixed duopoly with asymmetric and linear cost functions, the model suggests that public firm will price even lower after entry of a more efficient private firm. Using wholesale price data before and after entry, the empirical analysis provides consistent results with the theoretical prediction. Finally, I find that increased competition pressure in mixed duopoly also leads to stronger cost pass-through.

In one sentence § 2 of the Sherman Act condemns firms who “monopolize,” “attempt to monopolize” or “combine or conspire” to monopolize -- all without explanation. Section 2 is the antitrust law’s only provision that reaches entirely unilateral conduct, although it has often been used to reach collaborative conduct as well. In general, §2 requires greater amounts of individually held market power than do the other antitrust statutes, but it is less categorical about conduct. With one exception, however, the statute reads so broadly that criticisms of the nature that it is outdated cannot be based on faithful readings of the text. The one exception is competitive injuries that occur in secondary or complementary markets where they do not realistically threaten monopoly. As markets have become both more networked and more collaborative a significant emergent problem is actions by dominant firms that cause harm in secondary markets. For these, the United States would do better to incorporate an “abuse of dominance’ standard. This approach would be far superior to any of the many bills that address the issue of “self preferencing,” or dominant firm favoritism toward their own products. Adopting an abuse of dominance standard would require a brief legislative amendment. This essay additionally explores several related areas in which antitrust policy toward monopolization should take a different approach, particularly in networked markets. These include 1) Vertical Integration, Refusal to deal and Self-preferencing; 2) Mergers as Exclusionary Practices; 3) Anticompetitive Product Design and Restraints on Innovation; 4) Strategic, exclusionary Pricing; and 5) Anticompetitive Intellectual Property Practices.

There is no topic in regulatory policy that is more pressing and more controversial than what to do about the tech giants – Google, Facebook, Amazon, and Apple. Critics claim that that these powerful platforms crush competitors, distort the political process, and elude antitrust law because it cares only about consumer prices. The only solution, they argue, is to break them up. This diagnosis is mistaken. The tech giants have indeed engaged in anticompetitive conduct. They have excluded rivals selling products on their platforms by demoting them in search results, copying their products, or refusing to deal with them. While these tactics have harmed consumers, they have never been successfully challenged because they have rarely, if ever, created monopoly power or a dangerous probability of monopoly power, which the Sherman Act requires. This requirement should be eliminated. The tech giants should not be broken up. Splitting them into smaller versions of themselves would result in higher prices or lower quality. Preventing them from selling their own products on their platforms would deprive consumers of choices they value. Nor should the goals of antitrust law be changed. The fundamental aim of antitrust law is to protect consumers and suppliers like workers from anticompetitive conduct. If courts also had to focus on preserving small business and limiting the political influence of large firms, the goals of antitrust would conflict. Courts would have no objective way of resolving the conflict, the rule of law would suffer, and consumers and workers would be hurt. Congress should instead amend the Sherman Act to prohibit exclusionary conduct that significantly reduces competition, whether or not it results in actual or probable monopoly power. To avoid chilling procompetitive conduct, the change should apply only to the tech giants and should contain strict proof requirements. This careful expansion would make it much easier to deter tech giant exclusion that harms consumers or workers.

>Antitrust law and policy today are a semi-coherent welter of legal and economic doctrines. Immanent in them, however, is a structure of great simplicity and utility. The concept at the heart of the antitrust laws is the linear supply chain, consisting of an essential input, a downstream market in which competition is harmed through the discriminatory supply of the input to downstream firms, and consumers who pay higher prices for finished products as a result of the discriminatory behavior. Antitrust attacks this problem of the discriminatory supply of inputs in two ways. First, it seeks to prevent any one intelligence from taking control over the input, because absent such centralized control, competition from input suppliers eliminates any attempt at discrimination. Stopping the centralization of control over inputs is not always possible, however, because sometimes centralized control improves the quality of the input, and antitrust follows an implicit rule of “innovation primacy,” which holds that any act that plausibly improves the product likely does more good for consumers than any resulting increase in prices harms them, and so the act must be immune from antitrust scrutiny. ------->Second, antitrust regulates attempts by input controllers to use their power to increase their profits other than by charging what they know to be the highest possible prices for their products given their level of knowledge of consumer willingness to pay. Profits can be increased in this way by only three routes, each of which involves discrimination by the input controller in the supply of inputs to downstream firms. The input controller can discriminate in favor of firms that improve the final product ultimately sold to consumers and so increase consumers’ willingness to pay. The input controller can discriminate in favor of downstream firms that supply the input controller with information about consumer willingness to pay, enabling the input controller better to choose its prices to maximize its profits. And the input controller can discriminate against downstream firms that refuse to give the input controller access to profits that the firms have in turn extracted from consumers. The doctrine of innovation primacy protects discrimination that improves the final product sold to consumers, but not discrimination that facilitates information acquisition or the disciplining of refractory downstream firms. ------->This analysis resolves numerous longstanding conundrums in antitrust, including (1) whether antitrust picks winners (it must), (2) whether picking winners limits consumer sovereignty (impossible, because whenever a firm discriminates in the supply of inputs, the firm picks winners, and antitrust, which does no more than challenge such discrimination, therefore only ever substitutes its judgment for that of firms, never for that of end consumers), (3) whether antitrust should have a monopoly power requirement (it should, but the requirement should apply to the input market and not, as at present, to the downstream market in which competition is harmed), (4) whether firms should be allowed to compete on their own platforms as a general matter (of course they should, unless it is thought that consumers always know better than firms how everything they buy should be made, from start to finish), and (5) how to define the limits of the firm (the boundary of the firm does not end where formal ownership ends, but rather where discrimination in the supply of inputs ends). The analysis also shows why Lorain Journal, Aspen Skiing, Linkline, Trinko, Microsoft, Qualcomm, exclusive dealing, and tying are all the same basic case.

This article argues that the predominant interpretations of Schumpeter in competition law and economics are inaccurate. The aim of the article is to qualify some of the ossified narratives around Schumpeter’s legacy. To identify these misinterpretations, the article first provides an overview of the concept of creative destruction and Schumpeter’s account of ‘monopolistic practices’ as they were developed in Capitalism, Socialism and Democracy, Schumpeter’s most famous work to date (Section 2). It then lays out the prevalent competition law and economics accounts of Schumpeter (Section 3). This section focuses on the so-called ‘Schumpeterian thesis’, i.e., the proposition that big business or monopoly is more advantageous to innovation, which is attributed to Schumpeter. It shows how the so-called Schumpeterian thesis is connected to Schumpeter’s creative destruction in the literature. It also surveys various ‘Schumpeterian’ proposals of antitrust analysis built on creative destruction. The following Section 4 sets out the misinterpretations surrounding Schumpeter by contrasting the previous two sections, and by laying out Schumpeter’s thinking and scholarship in general. It details Schumpeter’s views on the concepts of monopoly and perfect competition, on the economic theories and policies of his day, his vision of the entrepreneur as the force behind creative destruction and his theory of entrepreneurial decline – all almost entirely missing from the popular works on Schumpeter in competition law and economics. Section 5 concludes.

We investigate a model in which a monopoly supplier distributes two types of its product through a traditional retailer with a wholesale price contract and an online retailer with an agency contract. Because such an agency contract eliminates the double marginalization problem, the online retailer has a cost advantage over the traditional retailer. Given the advantage of the online retailer, we also consider a possible request by the traditional retailer: the retail price of the online retailer is not smaller than the wholesale price for the traditional retailer. We obtain the following results. An increase in the online retailer's bargaining power over the supplier benefits the two retailers but harms the supplier. Under the request to protect the traditional retailer, the wholesale price is strictly higher than that in the baseline model. The retailers' equilibrium prices are also strictly higher than those in the baseline model. The request benefits the supplier and the online retailer, but harms the traditional retailer.

In the era of inter-industry convergence, abuses of substantial market power by large digital platforms such as Google, Apple, Facebook, and Amazon, and their increasing number of acquisitions towards small- and medium-sized tech-firms suspicious of eliminating potential competitors are recent representative issues in the ICT sector. Alternative competition policies have been discussed to effectively deal with those firms’ anti-competitive behaviors in a changing environment of competition such as a digital platform economy instead of traditional policies. In this regard, we examine the U.S. and EU competition policy responses to ICT firms’ anti-competitive behaviors in order to provide policy implications to our competition authority. According to our case studies, the U.S. and EU competition and legal authorities consider characteristics of the digital platform economy when they conclude whether firm behaviors are anti-competitive. Furthermore, we find that Facebook's acquisition of WhatsApp leads to a tipping effect and harms market competition. Given these results, we suggest that our competition authority has to consider the balance between innovation and competition when they implement competition policies in the era of inter-industry convergence.

The internet technology allows the harvesting, storage, and processing of large datasets about individuals and things. When new datasets are derived from the raw data, new information is generated, which can be both privately profitable and socially productive, serving to realize economies of scope and a better allocation of resources. Or these practices can amount to a mere unproductive transfer of wealth and facilitate unfair trade practices. The raw data often contain protected information on individuals. Internet regulation must therefore achieve three policy goals. It must protect the privacy of internet users, which is derived not from economic goals but from basic human rights. It must incentivize the production and use of derived datasets and open secondary markets for data. And it must effectively prevent the use of data for unproductive purposes. The current global legal situation achieves none of these goals. It allows the internet giants to reap monopoly profits, achieve market dominance, divert income streams, and reduce consumer welfare. And it does not sufficiently protect personal data. The efficient use of information cannot be achieved by competition law but rather through a combination of different property rights, an alienable erga omnes right for the subjects of information to protect their privacy, and an open data rule for depersonalized datasets, which would remove the current de facto property of data controllers. Processed and newly derived datasets should however be protected by copyright law.

In a market where consumers choose between payment options, and firms compete with products and prices, we show that payment data drives the formation of a market monopoly. A data sharing policy can successfully restore and maintain a competitive market, but often at the expense of both efficiency and consumer welfare. The introduction of a privacy-preserving central bank digital currency (CBDC), or digital cash, preserves the market structure and improves consumers’ welfare by enabling them to monetize their private information.

The America Invents Act of 2011 (“AIA”) created a robust administrative system—the Patent Trial and Appeal Board (“PTAB”)—for challenging the validity of granted patents. Congress determined that administrative correction of errors made in initial patent grants could be cheaper and more scientifically accurate than district court litigation over patent validity. In terms of private economic value per patent, few areas of technology can match the biopharmaceutical industry. Particularly for small molecule drugs, a billion-dollar drug monopoly may be protected from competition by a relatively small number of patents. Accordingly, the social cost of invalid patents—and, by extension, the potential benefit of PTAB review—is particularly acute in the biopharmaceutical industry. Conversely, to the extent that PTAB is overly assertive and improperly targets high-quality patents, the decrease in innovation incentives may be quite problematic. To investigate the issue empirically, our paper uses several novel datasets (made publicly available via the posting of this article) to study the respective roles of the PTAB and the district courts. Our empirical findings indicate that the PTAB’s role in adjudicating small molecule patents has been quite modest, substantially more modest than its role for other types of patents. Moreover, we do not find any evidence that the PTAB targets categories of small molecule patents that are generally considered high quality. To the contrary, the PTAB does not appear to differentially target even categories of small molecule patents that are generally considered to exhibit lower quality. We also find no evidence that the PTAB is targeting small molecule patents held by small entities. We conclude by discussing paths policymakers could take if they were interested in a more active role for the PTAB in policing the validity of small molecule drug patents.

The excessive pricing prohibition is recognized in many jurisdictions. In this article we use theoretical and practical considerations as well as experience from the implementation of the prohibition to shed light on its inherent difficulties, potential mistakes, and conditions for application. We begin by discussing five foundational principles that should affect the enforcement of the prohibition: (i) consumer welfare does not depend solely on price; (ii) incentives of firms to invest and innovate are crucial for consumer welfare; (iii) the prohibition increases the amount of uncertainty that firms face and impedes the efficient operation of markets; (iv) the competitive price is a valid benchmark only when perfect competition can exist; (v) currently the prohibition can be applied even if the monopolist gained its position by engaging in competition on the merit. We then apply these foundational principles to the prohibition. We also explore the fairness perceptions of consumers and the lessons learned from other types of price regulation. In the third part of the paper we analyze the inherent practical difficulties in applying the prohibition. We conclude with suggestions on the conditions under which the prohibition should be applied to ensure that its application enhances welfare. We also briefly summarize all EU and British excessive pricing cases to date. [The paper is written in Hebrew; we are also working on an English version of the paper].

The combination of Federal Communications Commission (FCC) regulations and Supreme Court decisions have created a circular regulatory regime wherein the FCC is the sole authority for making determinations regarding broadband internet services as well as the deferential authority for broadband competition and the result is people are left without legal recourse. The FCC determines the classification of broadband network services, which companies are allowed to provide said services, the amount of enforcement authority that will be enacted regarding those providing broadband services, and, in the event that a regional monopoly service provider takes any anticompetitive action, the FCC is also the sole authority to determine the appropriate response. This paper examines how the FCC, along with two decisions of the Supreme Court of the United States, Verizon Communications, Inc. v. Law offices of Curtis V. Trinko, LLP and Credit Suisse Securities (USA) LLC v. Billing. have created a market where all decisions regarding the regulation of broadband networks are deferred to the regulatory agency and restrict legal recourse for citizens that wish to pursue a claim under antitrust laws. Further, this paper will examine what the legal landscape would look like if there were Congressional action to overturn Trinko and Credit Suisse as envisioned in the recently published House Majority Staff Report on antitrust.

This paper develops a strategic trading model in which the market maker has a monopoly on short-lived information. Given that modern market makers are high frequency traders, it is assumed that market makers are able to process any short-lived information event faster than other traders. Since the market maker’s information is short-lived, informed traders sequentially learn about it and adjust their strategies accordingly. The correlation structure of the market maker’s short-lived information has significant effects on the dynamic trading equilibrium and can generate new stylized facts like negative trading intensities and non-monotonic news sensitivities.

While the various initiatives in several jurisdictions to impose ex ante regulation on “digital gatekeepers” – i.e., large online platforms that are necessary intermediaries between business users and their customers, and which are typically protected by high barriers to entry – have attracted considerable attention, the purpose of the present paper is to contribute to the policy debate on the equally important need to strengthen effective antitrust enforcement in digital markets. The focus of the paper is on possible adjustments to the current competition law framework or its enforcement with respect to unilateral (single-firm) conduct. Specifically, it examines four proposals to improve the effectiveness of antitrust enforcement in digital markets. First, it argues in favor of revisiting the error-cost framework and considering the introduction of presumptions of anti-competitiveness in limited circumstances. Second, it makes the case that competition authorities should make greater use of restorative remedies with a view to re-injecting lost competition in the market. Third, it discusses the need for greater focus on harms to quality and innovation. Fourth, it is argued that in circumstances where competition has been irreparably harmed and cannot be restored, competition authorities in the EU should consider pursuing exploitative cases.

This paper provides evidence on price rigidity at the product- and firm-level in Norway. A strong within-firm synchronization is found supporting the theory of economies of scope in menu costs. The industry synchronization effects are found to be small suggesting that firms either have some monopoly power, or that a firm’s costs of changing their own prices may be larger than the benefit of responding to their competitors’ price changes. These findings have potentially important implications for the micro-foundations of macroeconomic models, and thus the policy advice derived from such models.

App stores have become the subject of controversy and criticism within antitrust. For instance, app developers such as Spotify and Epic Games (creator of Fortnite) allege that Apple’s 30 percent cut of all sales in the App Store violates the antitrust laws and is indicative of monopoly power. The idea is that iPhone users are locked into Apple’s walled garden iOS platform, which frees Apple to engage in misconduct in the App Store “aftermarket” to the detriment of users and app developers. This Article challenges the recent economic and legal characterizations of app stores and the nature of the alleged harm. First, this Article builds an accessible, economic framework to illustrate how app stores do not represent the same type of aftermarkets that were condemned in the Supreme Court’s landmark Kodak case. Importantly, the differences between Kodak-like aftermarkets and app store aftermarkets raise serious questions whether the digital revival of the aftermarket doctrine conforms with the economic realities of these markets. Second, the complexity of the commercial relationships found in app stores has raised questions regarding who has standing to seek antitrust damages in this type of market setting. This Article provides an overview of the development of the current doctrine of antitrust standing—focusing on Illinois Brick and Apple v. Pepper. Further, this Article contends that Justice Kavanaugh’s opinion in Pepper, which gave iPhone users the right to sue Apple over the 30 percent commission, was right for the wrong reason. Instead, Justice Gorsuch’s dissent offers a much more economically sound approach to antitrust standing—as his “proximate cause” standard does not artificially focus on identifying the “direct purchaser,” which is unnecessarily limiting for more complex commercial relationships. As the number of antitrust claims against various app stores proliferate, the consequences of faulty characterizations of app stores will only grow.

An attempt is made by this study in order to determine whether AML is for protectionism or a leap forward. For this reason, the first part of this article sheds light on AMLs background along with aims and objectives of it while providing a precise glimpse into proposed merger under the AML. For this reason, the researcher took Coca Cola’s case in China. In addition to this, some concerns raised by scholars over the decision of China with regard to Coca Cola’s merger with Huiyuan are also addressed. The third part of this paper lays out a legal framework in order to create as well as implement AML, with special focus on the process of merger review. It is argued by the researcher that Coca Cola’s proposed merger was blocked by China under AML, which also drew world’s attention along with criticism. The reason is China flexed its antitrust practice muscles at the expense of this since a Coca Cola’s merger was blocked; while there is no doubt that it always attracts international business community. For decades China has been seen as the land of opportunity and growth for foreign investors and only time will determine whether this decision signals a change in that policy. The role of protectionism is explained by part three while investigating concerns with reference to public interests under AML. In this section, underlying rationale to block merger of Coca Cola with Huiyuan is analyzed by proposing that how can improvement be made by China in the merger review process. China made us believe that the decision to block such merger was for lessening and protecting competition, however, clear guidelines are greatly required by enforcement agencies in order to follow as well as increase transparency in the processes of decision making, it would ultimately help china to make better plans for enterprises in the future while showing China as a greatly attractive and fertile ground in order to grow and expand. The paper is concluded in part four along suggesting the adoption of clear merger guidelines which would diminish all the concerns raised by legal scholars; such guidelines would help foreign firms in terms of merger with domestic enterprise in China in the future. Qualitative research methodology has been applied to the following article.

Justice Holmes said that “the law” is merely a “prophec[y] of what the court[] will do” in the next case to come before it. Economists would call Holmes’ definition of the law a “rational expectation.” An antitrust economist examining Sanofi’s appeal in this case would ask: Would we rationally expect five members of the current Supreme Court to displace the well-established “equally efficient competitor” principle and replace it instead with the novel “effective entrant burden” heuristic, which the district court rejected below? Surely not. There is no serious prospect that the Supreme Court is about to strip the law of monopolization down to the studs and give it an entirely different facade. Nor is there any sound reason why the Court should want to do so. To the extent that any factual premise is necessary to frame amicus curiae’s economic arguments, it can be concisely summarized. Sanofi accused Mylan of monopolizing the market for epinephrine auto injectors, like Mylan’s EpiPen and Sanofi’s Auvi-Q. EpiPen had a high market share going back many years before Sanofi entered in 2013. Mylan had always paid small rebates to the pharmaceutical benefit managers (“PBMs”). After Auvi-Q entered, Mylan paid larger rebates, often in exchange for preferential or sometimes exclusive positions on PBM formularies. After a year or more of being disinclined to compete on price, Sanofi began to respond to PBM requests for competitive rebates and did much better in formulary coverage and market share. Some PBMs gave Auvi-Q exclusive coverage, and there Mylan’s share of EpiPen shrank close to zero. In mid-2015, however, Auvi-Q was withdrawn for unreliable dosing, and Sanofi gave up the product. Sanofi’s expert economic witness, Professor Fiona Scott Morton, opined that Mylan had monopoly power, as evidenced by its share, and that its exclusionary rebates anticompetitively foreclosed the market, making competition impossible. Scott Morton relied on Mylan’s documents expressing its intent to win. She also relied on her 2017 law review article arguing that discounts can be foreclosing where much demand is non-contestable. Scott Morton opined that the rebates in essence taxed Auvi-Qs so they could not compete. The district court found undisputed proof that Sanofi and Mylan could compete vigorously over rebates for preferential positions on PBM formularies and eventually did so (once Sanofi decided to compete on net price); that net prices consequently fell; that there was little foreclosure of entry under any economic definition; that there was little non-contestability of demand for EpiPens; and that Sanofi ultimately exited the market following problems maintaining its own product’s quality. This brief is a rifle shot addressing solely the economic merits of Sanofi’s last-gasp argument. Sanofi cannot win on the facts under existing law. Its only recourse is to ask this Court to replace the equally efficient competitor principle as the controlling law with Scott Morton’s novel theory and then decide the case in Sanofi’s favor—not based on whether the challenged conduct harmed competition and consumer welfare, but rather on the presence or absence of an “effective entrant burden.” That novel theory would flout Supreme Court antitrust jurisprudence by incorrectly elevating competitor welfare over consumer welfare. It finds no support in current antitrust law or economic principles, and it could not plausibly become the law of monopolization in the Holmesian sense. This Court should affirm.

Growing concern about large digital platform companies, particularly Google, Facebook, Amazon, and Apple, exercising monopoly power has given rise to antitrust investigations that examine whether they are guilty of exclusionary practices. After defending the consumer welfare standard as the basis for decisions, this paper explores whether the market power and conduct of each company justifies antitrust action. Whether to pursue such action should be based partly on a counterfactual analysis of the consequences of the likely remedies that would be applied if a company is found guilty. Remedies, such as divestiture of acquired firms or structural separation of vertically integrated firms, would likely harm consumers who benefit from lower costs and increased innovation that result from combining complementary products into one ecosystem. This paper argues against a more activist antitrust policy considering the knowledge and incentives of the courts and those who enforce it. It is difficult to accurately assess the effects of firm conduct on consumer welfare, and enforcement agencies’ decisions may not be based entirely on objective analysis but on political pressure, sometimes from a firm’s competitors. Instead of pursuing more activist antitrust policy, the government should remove barriers that keep firms from entering new markets and competing vigorously.

The digital economy has brought new business models that rely on zero-price markets and multi-sided platforms that exploit broad business ecosystems. The traditional concept of market power used by competition authorities cannot engage with this new reality, which is more multidimensional than the usual focus on price (and output). A number of jurisdictions also try to grapple with the broader concern over the bargaining power of large digital platforms and the rise of gatekeepers in the digital economy. These developments have culminated in the recent calls for a more multidimensional concept of (economic) power, in particular in the context of competition law enforcement against unilateral conduct and suggestions over new concepts of power triggering antitrust/regulatory intervention, such as “strategic market status”, “conglomerate market power, “intermediation power”, “structuring digital platforms”, or “gatekeepers” to complete, or even substitute, the archetypical concept of market or monopoly power in competition law. The multiplication of new concepts of power signals the creativity and flexibility of the competition law enterprise as it seeks to take into account new economic realities. However, what is crucially missing is an overall theoretical framework for this multi-dimensional concept of power, taking into account this new reality arising out of the use of new business models in ecosystems. We aim to fill this gap in our conceptual understanding by putting forward an ontology of (economic) power which integrates these new dimensions. This is completed with a more ‘empirical’ perspective exploring the various ways these new dimensions of power can be measured. We thus recognize the importance of culminating this concept-building approach with the more practical undertaking of developing adequate new metrics that guide and, by the same, limit administrative discretion in enforcing competition or regulatory law.

By making the App Store the only official channel for iPhone owners to buy apps, Apple has created the only market in which iPhone owners and app developers may transact their business. Apple exploits the bottleneck that it creates by imposing a 15 percent or 30 percent commission on transactions between iPhone owners and app developers. The array of Apple litigation elicited by this conduct may pose a case of first impression, since there does not appear to be a pigeonhole for Apple’s conduct. Apple neither buys nor sells third-party apps and therefore it does not exercise monopsony or monopoly power. If plaintiffs frame their antitrust challenges correctly, a court will have to determine whether Apple’s conduct—use of its proprietary technology and threats aimed at both app developers and iPhone owners—offends Section 2 of the Sherman Act. If the court finds that Apple has violated Section 2 of the Sherman Act, then it must also decide who has suffered antitrust injury and who has standing to sue under Section 4 of the Clayton Act. We offer an economic analysis of these issues.

The rapid rise, expansion, and growing asymmetric power of online platform firms towards other businesses, labor and even the state itself occurred in a context of minimal regulatory oversight. In many respects, because the existing legal system was handicapped in understanding and regulating the new platform business models. The platform firms undermined traditional industry boundaries and developed surprising synergies by expanding in unexpected ways due to their ability leverage data and computational expertise. The growth of these platforms was accompanied by minimal intervention by state actors until recently, as concerns about the platform firms’ remarkable power has attracted the concern of States globally and the previous regime is giving way to intense debate and increasingly interventionist governmental policies and enforcement actions. We examine several salient aspects of this emerging regulatory and political reaction, and suggest that this represents an attempt to rebalance the positions of social groups in their relationship to the increasingly central platform firms. First, we view the rise of, and recent political responses to, the often-predatory power and manipulative conduct of platform firm in terms of a “Polanyian” double movement in which the destabilizing and destructive effects of unchecked corporate power and market development eventually generates political and regulatory responses to constrain private actions by new economic actors as they threaten the social, political, and economic order. Second, incipient legal changes, most notably the EU’s proposed Digital Markets Act and Digital Services Act, indicate a shift in regulatory emphasis from competition (and antitrust) policy and law, which has proven limited in its capacity to address inherent monopolistic tendencies of platform firms and markets, towards more intensive and encompassing forms of social and economic regulation. Finally, the political dynamics of legal and institutional change open up new possibilities for political economic and societal reordering, but the particular changes will likely vary in character and significance across political jurisdictions, and therefore follow distinctive and possibly divergent developmental trajectories. We hypothesize that the EU may be able to become the first-mover in regulating the powerful multinational platform firms. We recognize that we are at the very beginning of a transformational process that is likely to reorder old and generate new political economic interests, identities, coalitions, and conflicts at the sectoral, national, regional, and international levels.

Contemporary American interest in using antitrust law to address wealth inequality is a symptom of American political dysfunction rather than a reflection of any intellectual advance regarding the sources of inequality. Indeed, both the original American progressives of a century ago, as well as Thomas Piketty, whose work sparked contemporary intellectual interest in inequality, agree that inequality’s source is scarcity, rather than monopoly, and so will persist even in perfectly competitive markets. The only real solution is taxation, not a potentially destructive campaign of breakup. There are two causes of contemporary American antimonopolism. The first is American anti-statism, which has closed off tax policy as a viable political solution to inequality, forcing scholars and activists to seek a second- or third-best workaround in antitrust policy. The second is the American press, which is actively promoting antimonopolism as a way of fighting back against Google and Facebook, two companies that have badly outcompeted the press for advertising dollars in recent years. Given these idiosyncratic roots of contemporary American antimonopolism, other jurisdictions seeking to address inequality may have little to gain from following the American example, particularly if taxation remains a viable policy option for them.

The idea that consideration of error costs should inform judgments about actions with uncertain consequences is well established. When we act on imperfect information, we consider not only the probability of an event, but also the expected costs of making an error. In 1984 Frank Easterbrook used this idea to rationalize an anti-enforcement bias in antitrust, reasoning that markets are likely to correct monopoly in a relatively short time while judicial errors are likely to persist. As a result, false positives (recognizing a problem when there is none) are more costly than false negatives. While the problem of error cost bias is not explicitly mentioned all that frequently in antitrust cases, its influence is broad and deep, guiding the formation of presumptions and burdens of proof. The anti-enforcement bias in antitrust originated long before Easterbrook wrote, and was reflected in the work of George J. Stigler and Milton Friedman, mainly in the 1940s and 1950s. They had attempted to dismantle theories of imperfect competition in favor of models in which competition nearly always prevailed unless restrained by government action. While the ideas underlying the error cost framework were relatively new ones in law schools, by the 1980s they were already in decline in industrial organization economics. Easterbrook was writing defensively. An empirical revolution in economics was already well engaged in a process that found imperfect competition models to be more testable, more dominant, and more useful for policy judgments. In the process, classical Marshall/Stigler models of perfect competition were all but abandoned as irrelevant. This empirical work provides increasing evidence that United States antitrust policy, but particularly merger policy, took a significant wrong turn in the mid-eighties. Today the error cost framework exists mainly as a result of rent seeking by firms who stand to profit from the low output and high margin consequences of this antitrust anti-enforcement bias.

This short note prepared for an OECD meeting in June 2021 examines several antitrust issues involving analysis of potential competition. While the analysis is not new, it is still useful to collect them together in a unified fashion to show how they are related. In this regard, all the analysis and conclusions flow from the overarching (and obvious) points that exclusionary conduct and agreements that maintain monopoly power very often harm consumers, and that monopoly profits typically exceed the combined duopoly profits earned by the dominant firm and the entrant, if there is successful entry. While this is not inevitably the outcome, it is a useful working assumption for most market situations involving acquisitions, exclusion or agreements with potential or nascent competitors.

We develop a model to derive an optimal price for a bundle of two goods when buyers are risk averse and uncertain about the valuation of each good. In theory, the optimal bundle price depends not only on the probability of a positive valuation of each good, but also on the correlation between the two valuations. We analyze a unique airlines dataset in which we directly observe the prices of both bundled (round trip ticket) and unbundled items (two one-way tickets) for identical itineraries. We find that airlines offer bundle discounts, and that these discounts increase when the correlation between outbound and inbound demands is higher. Moreover, higher certainty about demand decreases bundling discounts. We also find that bundling discounts decrease with competition.

Australia's competition laws include a general access regime for monopoly infrastructure (Part IIIA of the Competition and Consumer Act). Recently, there have been calls to extend this law - through a new 'Part IIIB'. This paper considers the proposed amendments and finds that there is no economic case for change. Proponents of reform argue that the existing law has a gap. Our analysis shows that this is wrong and the current law can deal with both vertically integrated and separated facilities. We show that the current 'declaration criteria' identify both the relevant infrastructure services and the circumstances when regulatory action is warranted. We also consider if there are either competition problems or economic distortions due to investment ‘hold up’ that could be fixed by Part IIIB? For competition, we conclude that any relevant concerns are already addressed by Part IIIA. For investment ‘hold up’ we note that this is a broad issue that arises in many industries. At best, Part IIIB would crowd out preferred business-to-business solutions to the hold-up problem. At worst, Part IIIB would create, rather than reduce, economic distortions. Overall, we find that the case for further access regulation through a Part IIIB has not been established. Given Part IIIA, there is no regulatory gap for monopoly infrastructure industries in Australia that could be fixed by the proposed Part IIIB. Put simply, Part IIIB is a solution in search of a problem.

This paper gives a fresh account of competition in the digital economy. Economic analysis in the field of industrial organization remains largely focused on a sophisticated version of the Schumpeter-Arrow debate, which is unresolved and largely irrelevant. We posit the need to look at competition anew. Static models of monopoly firms and markets in equilibrium are often used to characterize Big Tech firms’ size and scope. We suggest that this characterization is inappropriate because the growth and diversification of many digital firms lead to a situation of broad-spectrum competition that cuts across markets. Current market positions do not reflect monopoly power but are vulnerable to the competitive pressure of disequilibrating forces arising from the use of data-driven operating models, astute resource orchestration, and the exercise of dynamic capabilities. A few strategic errors by management in handling internal transitions and/or external challenges and big tech firms could be competitively impaired. The implications of a more dynamic understanding of the competition process in the digital economy are explored. We consider how big data and entrepreneurial management impacts firm performance. We also explore the nature of different types of rents (Schumpeterian, Ricardian, and monopoly rents) and suggest a modified long-term consumer welfare standard for competition policy. We formulate preliminary tests and predictors to assess dynamic competition. Our perspective advances a policy stance that favors innovation.

The present chapter investigates the antitrust rules applicable to loyalty or fidelity rebate schemes under EU competition and US antitrust law. It finds that antitrust liability for a dominant company will more readily be established in the EU, where the applicability of economics-based tests is still being navigated. In the US, rebates by a monopoly player will usually be found to be anti-competitive where they constitute predatory pricing, although they might also run into antitrust liability where they constitute exclusive dealing arrangements. This divergence can be explained by the different ideological underpinnings in the two jurisdictions. Overall, however, the (case) law on loyalty rebates is still in a state of flux in both jurisdictions. In recent years, both jurisdictions have gradually moved to a little more convergence in their treatment of exclusivity rebates. At this point, however, both the US Supreme Court and the European Court of Justice will need to weigh in on the future of the antitrust assessment of loyalty-inducing rebates.

This paper studies the effect of consumer myopia on the interplay between core and side downstream markets in monopoly and duopoly platforms. Our results highlight the relevance of consumer myopia in strategic platform decisions.

We offer a theory of how the combination of budget constraints and insurance drives up prices. A natural context for our theory is the health care market, where drug prices can be very high. Our model predicts that monopoly prices for orphan drugs are inversely related to the prevalence up until a maximum price. This is supported by empirical evidence in the literature. As a result, prices of drugs sold by a monopoly treating rare serious diseases are doomed to go sky high.

Friedrich A. von Hayek’s (1899-1992) view of competition as a discovery process is well known but little used. His central thesis is that a competitive pricing system is the most effective way to coordinate economic activity and economise on the information held by market participants in a world of generalised ignorance and change. But do the tremendous advances in computing and data management undermine Hayek’s claim that the market is superior? Does his focus on prices make his view of competition less relevant to the digital economy? Even Hayek had doubts. Unlike most ‘Austrian economists’ Hayek saw a need for antitrust to deal with the exclusionary abuses of ‘non-privileged monopolies’ and restraints of trade. Yet the conceptual basis for this is vague and it jars with Hayek’s view of liberal market law as spontaneously created. Here I critically assess Hayek’s views on competition, monopoly and antitrust, and their relevance to the ‘digital economy’.

In July, 2021, President Biden signed a far ranging Executive Order directed to promoting competition in the American economy. This paper analyzes issues covered by the Order that are most likely to affect the scope and enforcement of antitrust law. The only passage that the Executive Order quoted from a Supreme Court antitrust decision captures its antitrust ideology well – that the Sherman Act: rests on the premise that the unrestrained interaction of competitive forces will yield the best allocation of our economic resources, the lowest prices, the highest quality and the greatest material progress, while at the same time providing an environment conducive to the preservation of our democratic political and social institutions. Northern Pac. Ry. Co. v. United States, 356 U.S. 1, 4 (1958) (Black, j.).

Modern antitrust laws (including the federal antitrust laws and the antitrust laws of other states, as well as the cognate laws of numerous other jurisdictions around the world) generally include provisions that limit unilateral business conduct that may create, protect, or extend monopoly power by unreasonably exclusionary practices. In contrast, New York’s main antitrust law, the Donnelley Act of 1899, contains no such provision. The GAI recognizes that adding such a provision to the Donnelley Act is an intended objective of S.933. There are several serious questions, however, raised by key aspects of S.933. Specifically, while S.933 §3 adopts a prohibition on monopolization similar to that found in Section 2 of the Sherman Act, 15 USC § 2, it also includes a prohibition on “abuse of dominance.” S.933 provides limited information regarding the definitions of “dominance” and “abuse.” Rather, S.933 delegates very broad discretion to define these terms to the New York Attorney General (subject to a specific form of legislative veto). This approach presents a number of serious risks and uncertainties. For reasons explained more fully below, the Committee should consider withholding any favorable recommendation on S.933 so long as it contains the abuse-of-dominance provision.

The EU and US antitrust law provisions on unilateral conduct are often understood as remedying the competitive harm resulting from the exercise of significant market power. They only apply when firms hold dominance or monopoly positions. Nonetheless, this chapter explores existing laws and planned legislative proposals diverging from this premise. It highlights the different degrees and types of economic power embedded in the EU and US rules that limit the conduct of firms holding lower thresholds of market power, relative power (e.g., economic dependence, and unfair practices), or gatekeeper powers. The chapter exposes a gap between the notions of power and the theory of harm, challenging the dividing line between protection against harm to effective competition and harm to competitors. Accordingly, the chapter calls upon legislators and enforcers to align the notions of power with the harm and interests covered by the laws.

This paper examines frequent efforts by individual polyglots to monetize their linguistic capabilities through social media and YouTube. In drawing an analogy from microeconomic studies, the paper finds that the microeconomic logic of monetizing individual distinction in polyglots is flimsy, owing to the low barriers to entry, mass dissemination of videos, absence of monopoly power, language’s public nature, and indistinguishability of individual brands. This paves the way for rejecting monetization and the fostering of polyglotism as a public good, fostered and cherished by collectives rather than individuals, as done by HYPIA.

In the context of the actual debate about the necessity of a deep reform of competition law, this thesis pretends to update the concept of platform market dominance. The author held that the traditional theoretical abstract framework used in competition law’s analysis does not fit to platform as this is a new type of meta-organization differently from traditional firms and decentralized markets. For the author, in the new platform economy, to find the correct concept of platform market dominance is necessary to differentiate between platform market dominance inside the platform ecosystem and market dominance when occurs competition between platform organizations. This academic work just claims that it is time for antitrust academics to recognize that the traditional conceptualization of monopoly has changed due to the recent technological revolution.

This paper provides evidence on price rigidity at the product- and firm-level in Norway. A strong within-firm synchronization is found supporting the theory of economies of scope in menu costs. The industry synchronization effects are found to be small suggesting that firms either have some monopoly power, or that a firm’s costs of changing their own prices may be larger than the benefit of responding to their competitors’ price changes. These findings have potentially important implications for the micro-foundations of macroeconomic models, and thus the policy advice derived from such models.

Indeed, it is the economic regulation that shaped present ‘competitive market structure’ in Malaysia. This market structure hence generated the ‘competition culture’ in many industries. The structural changes contributed to transition of a regulated market-based to open market- based economy. The transition saw competitive market structure illustrated by the involvement of private and public enterprise as market players in the main and sub sectors. The first sectors were telecommunication and energy. These sectors have shown stable and robust competitiveness in the market whereby private entities and independents telecommunication companies compete in the Malaysian tele-communication market. The competitive culture saw a liberalised and deregulated market based that brought about efficiencies in services, prices and innovations. Secure and continuous pharmaceutical supplies are structural responsibilities shared by all stakeholders in the market. Pharmaceutical industry generated and garnered extensive intellectual rights in terms of drugs, services and medical supplies. Manufacturers in pharmaceutical sectors invests massive funding to develop new creations, this is evident by the COVID-19 vaccines, patent and trademarks rights are thus awarded to the creators of the innovation. The ‘competition culture’ illustrated through stable and extensive electricity, internet coverage, lower prices, choices of products and services for customers. Amidst the post pandemic crisis, pharmaceutical supply chain has become one of the important sector that require attention in sustainability and accessibility. Documentary examination shows, to date, present pharmaceutical market structure divided between levels 1, 2 and 3 represent monopolistic and oligopolistic structural framework. Summative assessments revealed there are ant –competitive behaviour’s concerns in the sector. Instituting ‘competition culture’ and enhance competition regulatory measures are pivotal in advocating a level playing fields in all three levels. Comparative method examination from other jurisdiction experiences and lessons are the parameters of this article. This studies hope to examine and discuss existing constraints in structural framework and competitive culture in pharmaceutical drugs market. The structure of this Article is the following. In Part 1, explain the relationship of patents rights and competition policy and law, industry market structure, market players and relationship between intellectual property patent laws and competition laws. Part 2, explain anti-competitive behaviours from patent holders and challenges and implications on the violations of competition law. Part 3 recapitulates the constraints, issues and structural suggestions for workable ‘competitive culture’ in the pharmaceutical market. We hope this studies will provide further research gap for future research.

How does a firm’s market power in existing products affect its incentives to innovate? We explore this fundamental question using granular project-level and firm-level data from the pharmaceutical industry, focusing on a particular mechanism through which incumbent firms maintain their market power: “reverse payment” or “pay-for-delay” agreements to delay the market entry of competitors. We first show that when firms are unfettered in their use of “pay-for-delay” agreements, they reduce their innovation activities in response to the potential entry of direct competitors. We then examine a legal ruling that subjected these agreements to antitrust litigation, thereby reducing the incentive to enter them. After the ruling, incumbent firms increased their net innovation activities in response to competitive entry. These effects center on firms with products that are more directly affected by competition. However, at the product therapeutic area level, we find a reduction in innovation by new entrants after the ruling in response to increased competition. Overall, these results are consistent with firms having reduced incentives to innovate when they are able to maintain their market power, highlighting a specific channel through which this occurs. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

The antitrust “essential facilities” doctrine is reawakening. After decades of rejection and decline, the doctrine’s approach of granting access rights to facilities for which there is no reasonable alternative in the market has received several high-profile endorsements across the political spectrum. While courts have mainly applied the doctrine to physical infrastructure, its potential now lies in addressing the gatekeeping power of online platforms. However, despite its recent endorsements, the doctrine’s criticisms linger. Many of the objections to the essential facilities doctrine are fueled by persistent myths and misconceptions, most prominently related to its economic justification, administrability, and propensity to entrench monopoly power. This Article lays out the case for the essential facilities doctrine in the digital economy and addresses the most common counterarguments that limit the doctrine’s potential to open digital markets.