Vertical Restraints and Antitrust Policy.

This article reports that antitrust policy toward vertical restraints is the biggest substantive issue facing antitrust. It is opined that the issue of the proper antitrust stance toward vertical restraints may be procedural and institutional as much as it is analytical. It is only recently that antitrust scholars have begun to establish systematically the conditions that sometimes make vertical restraints rational methods of maximizing profits by reducing competition. To the extent that these scholars are persuasive, their findings are consistent with the fundamental premise of the Chicago school that antitrust issues should be analyzed on the assumption that business firms are rational profit maximizers, so that the standard theorems of price theory can be used to predict the competitive effects of a challenged transaction.