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Another Gem from the New Deal

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Here’s a letter to the Wall Street Journal:

Marc Levinson offers a splendid history of A&P and of the Robinson-Patman Act’s assault on that company’s efforts to translate its superior efficiencies into lower grocery prices for consumers (“When Creative Destruction Visited the Mom-and-Pops [2],” Oct. 12).

The Robinson-Patman Act of 1936, although trumpeted as an act to enhance competition, is such a barefaced effort to protect politically influential producers from having to compete against more innovative rivals that it was called by the late Donald Dewey – a usually soft-spoken antitrust scholar at Columbia University – “an execrable concession to small business groups and an insult to the public intelligence.”*

Indeed it is.  Unfortunately, other antitrust statutes, including the Sherman Act, differ from Robinson-Patman only in being less blatant about their anti-competitive goals [3].

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030

* Donald Dewey, Monopoly in Economics and Law [4] (Chicago: Rand McNally & Co., 1959), p. 198.

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