“We Protect Competition, You Protect Competitors”

Abstract

It is widely stated, in contemporary antitrust circles, that antitrust law protects consumers, not competitors. This article explores two questions: Do these words have a clear and uniform meaning, and, Is the statement a fair description of what antitrust laws in fact do? Antitrust laws protect competition. But the laws do not mandate competition; they simply intervene to prevent certain obstructions. This mission may take one or more of three paths: 1) prevent direct harm to consumer welfare by output-limiting acts or transactions, 2) also, protect the openness of markets, and 3) also, put a lid on aggressive competition that might destroy a market of smaller, weaker firms. This article argues that only the third category unabashedly protects competitors. The second category takes a broad view of a dynamic process that “should” not be degraded. It is not designed to protect competitors from competition. But the second category could err on the side of protecting competitors unless the jurisdiction gives serious regard to efficiency justifications, even while the first category could err on the side of perpetuating the power of dominant firms.

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