The Morality of Monopolization Law

Abstract

Section 2 of the Sherman Act prohibits monopolization, attempted monopolization, and conspiracies to monopolize. The federal courts, in interpreting the ban on monopolization, have held that monopoly power must be accompanied by bad conduct to be illegal. Monopoly power alone is insufficient for establishing liability under the Sherman Act. While cataloging a list of practices, such as exclusive dealing and predatory pricing, as “anticompetitive,” the federal judiciary has failed to articulate what principles distinguish bad conduct from good conduct in this context. A close read of the case law reveals an implicit morality in which businesses cannot use their dominance, superior access to finance, or generally prohibited practices to acquire or maintain a monopoly. To clarify the law and provide greater guidance for businesses and the public, the Federal Trade Commission should use its expansive “unfair methods of competition” authority to codify and strengthen existing norms of fair competition.

Keywords: Antitrust, antimonopoly, fair competition