Walter Eucken and Ordoliberalism: An Introduction from a Consumer Welfare Perspective

Abstract:     
This article serves two purposes, (i) to introduce “The Comparative Order and its Implementation,” a seminal article published in 1949 by Walter Eucken, ordoliberalism’s, or the “Freiburg School’s,” most prominent scholar, and (ii) to compare some ordoliberalist competition policy recommenda-tions to those of a consumer welfare standard. The article provides an overview of the key concepts of ordoliberalism (such as “competitive order,” “economic constitution” and “Ordnungspolitik”) and outlines its implications for competition policy. It provides examples for the ordoliberal legacy in German and European competition policy, such as, inter alia, the market share thresholds for dominance, and the control of exploitative abuses such as excessive pricing. Finally, the article gives a critique of ordoliberalism from a consumer welfare perspective, and looks, among other things, at the implications of ordoliberalist policies for innovation and dynamic competition, the roots of the structureconduct-performance paradigm, and the classification of certain forms of unilateral behavior (e.g., tying).

Number of Pages in PDF File: 22

Keywords: Ordoliberalism, Ordoliberalismus, Ordnungspolitik, Eucken, Freiburg School, Freiburger Schul, consumer welfare standard

JEL Classification: K21, L40

Accepted Paper Series