Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
Antitrust Practice and Market Power
Antitrust Practices and Market Power
government promulgates antitrust law to prohibit unfair business practices in the United States and enhancing competitions within the U.S. marketplace. Several business practices are considered illegal under the antitrust law and these practices include illegal monopoly, price fixing, illegally discouraging competition, and bid rigging. For example, Sherman Antitrust Act of 1890 prohibits monopolizing the interstate commerce, bid rigging, and price fixing. Moreover, The Clayton Act of 1914 also prohibits all form of merger and acquisition that could restrict competition. Companies considered violating the antitrust law may be subjected to fines and the officials may face jail term.
Why were firm(s) being Investigated for the Antitrust Behavior?
The government can investigate firms for antitrust behaviors if the government suspects that a firm is carrying out the antitrust business behaviors that could violate antitrust law. An issue of Microsoft vs. Department of Justice was a special case of antitrust violation. Microsoft is the largest producer of computer software with highest valuation in the world. The company produces application...
In 1990s, the Department of Justice investigated Microsoft for various antitrust allegations, and the government accused the Microsoft of using its monopoly power of its PC (personal computer) operating system to harm competitors and exclude rivals. (Stucke, 2013).
The antitrust discourages monopoly because monopoly practice discourages competition. Typically, monopoly is a form of business operation where there is a single seller of product or services in the market. Since monopoly is the only producer of goods or services, a monopoly can set any price as it pleases if there is not government intervention. One of the negative effects of monopoly is that it discourages consumers to make a choice from wide variety of products thereby reducing the aggregate welfare of consumers. (Stigler, 2013). The harmful effect of monopoly leads to birth of antitrust laws aimed to discourage monopolistic practice.
On the other hand, oligopoly refers to a business practice where there are few sellers in the market thereby leading to competition among firms. Unlike monopoly that restricts the free choice consumer, Oligopoly allows a free consumer's choice…
Reference
Economides, N.(2003). The Microsoft Antitrust Case, A Case Study for MBA Students. Stern School of Business, New York University.
Lenard, T, M., (2000). Creating Competition in the Market for Operating Systems: A Structural Remedy for Microsoft, mimeo. The Progress & Freedom Foundation.
Reddy, B. David, E. And Albert, N. (2000), "Why Does Microsoft Charge So Little for Windows?" mimeo.
Stigler, G.J. (2013). Economics. The Concise Encyclopedia of Economics.
Microsoft Antitrust Case Antitrust Practices and Market Power Antitrust case: 2001 antitrust Microsoft settlement Microsoft Windows is such a ubiquitous piece of software, it is virtually impossible to imagine using a computer without it. Even though many people dislike the system, to function in contemporary life requires most students and workers to be familiar with the product. This lack of de facto choice has led Microsoft to become the subject of numerous antitrust
ANTITRUST Economics Antitrust practices and market power: Technology, social networking sites, and anti-competitive behavior Q1.Why was/were the firm(s) investigated for antitrust behavior? IBM, AT&T, Microsoft, Intel, Google, Twitter, and Facebook are all technology companies that have been accused of operating as de facto and de jure monopolies: in other words, of engaging in blatant violations of the Sherman Antitrust Act or of substantially limiting market competition to such a degree that a monopoly has been
Antitrust Case Background One recent antitrust action has been between the United States Justice Department and the credit card companies. The government has argued that American Express has hindered competition in the credit card market. At issue are rules that AMEX imposes on retailers to prevent them from offering incentives to customers to use other cards (Longstreth, 2014). This is not the first time that credit card companies have faced antitrust action,
Antitrust Practices and Market Power It is important to realize the reason that Microsoft was investigated for possibly violating antitrust laws at the turn of the millennium. The company had established something of a natural monopoly of the software market (which is distinct from a government monopoly), and was leveraging its considerable market power to systematically eliminate its competition. It is legal to establish a monopoly in any given industry; yet
Antitrust Practices and Market Power The modern business environment is increasingly characterized by the proliferation of emerging monopolies in various industries. One of the industries that have experienced an increase in budding monopolies is Information Technology, particularly with the growth and development of social media and networks. Technology companies have rapidly developed into monopolies because of the connection between attractive business opportunities. The growth of leading technology companies into monopolies has
Antitrust and Intellectual Property Antitrust Law Remedies in Intellectual Property Cases In any research paper it is important to first define the terms used prominently in order to make sure that the reader understands what is being said. In this case, the two terms that require definition are antitrust and intellectual property. According to a definition from Cornell University Law School "Trusts and monopolies are concentrations of economic power in the hands