Towards a More Vigorous Antitrust Policy?

The growth of the large, “dominant” digital platforms – as well as increases in national concentration of U.S. industries and average profit margins, and a decline in labor’s share of national income – have prompted calls for a stronger antitrust policy. The Federal Trade Commission (FTC) and the U.S. Department of Justice (DOJ) have recently responded with a more vigorous attack on mergers and have launched monopolization cases against Amazon, Apple, Facebook, and Google; two of these suits specifically seek divestitures as remedies. The early results of the more aggressive merger policy are not favorable, and the likelihood that court-ordered divestitures would be effective in increasing competition is low if the results of previous monopolization cases are a relevant guide. In addition, two pieces of legislation have been proposed in the U.S. Congress to curb the power of the large, dominant digital platforms. Neither of these proposals addresses the source of the platforms’ dominant positions; they would merely constrain the ability of these platforms to exploit their market positions. One of these bills, however, would require the largest platforms to interconnect with other businesses and, potentially, their rivals. This is a proposal that could result in all of the problems that a similar policy in telecommunications created two decades ago.