Anti-Trust

[Dr. Shane]

Some economists have concluded that in most cases, anti-trust laws are more about protecting competitors than consumers.

For example: a few companies in the same industry may merge and as a result become more effective and lower the price on their product (whatever it may be). Thus the merger benifits the consumer. But as a result a number of competitors in that industry have a hard time making a profit. Politicians move to enforce anti-trust laws, the merger is broken up and prices increase.

The last big anti-trust case was Microsoft and focuses was on its Explorer software. Microsoft's competitors, like Netscape, complained that Microsoft had an unfair advantage because its internet browser came on all window-based PCs. Microsoft was able to give its browser away for free with its operating system. Obviously it was hard for Netscape to compete with free. Today Explorer still comes with Microsoft operating systems and yet Mozilla Firefox is giving it a run for its money. So the anti-trust action against Microsoft doesn't seem like it was for the consumer's benifit.