Is Antitrust Too Complicated for Generalist Judges? The Impact of Economic Complexity & Judicial Training on Appeals

Abstract:     
Modern antitrust litigation sometimes involves complex expert economic and econometric analysis. While this boom in the demand for economic analysis and expert testimony has clearly improved the welfare of economists - and schools offering basic economic training to judges - the law and economics literature is silent on the empirical effects of economic complexity or judges' economic training on decision-making in antitrust litigation. We use a unique data set on antitrust litigation in federal district and administrative courts during 1996-2006 to examine whether economic complexity impacts decisions in antitrust cases, and thereby provide a novel test of the frequently asserted hypothesis that antitrust analysis has become too complex for generalist judges. We also examine the impact of one institutional response to economic complexity: basic economic training by judges. We find that decisions involving the evaluation of complex economic evidence are significantly more likely to be appealed, and decisions of judges trained in basic economics are significantly less likely to be appealed than are decisions by their untrained counterparts. Our results are robust to a variety of controls, including the type of case, the appellate circuit in which the case is litigated, level of judicial experience with antitrust claims, judicial quality, and the political party of the judge. Our tentative conclusion, based on a revealed preference argument that views a party's appeal decision as an indication that the initial court got the economics wrong, is that there is support for the hypothesis that some antitrust cases are too complicated for generalist judges.

Keywords: ABA Task Force, battle of the experts, Bork, competition law, Daubert, econometrics, expert witness, FTC, George Mason University Law and Economics Center, Mandel, political economy, Posner, Sherman Act

JEL Classifications: A2, A11, A13, A23, B20, K10, K21, K41, L4

Working Paper Series