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Presumptions Are Not Facts

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Here's a letter that I sent to the Washington Post:

Seeking more active
application of antitrust regulations, Steven Pearlstein wants the
Supreme Court to reject "the view of Chicago school economists" – a
view in which, according to Mr. Pearlstein, "monopolies are actually
good for consumers because they attract the money and talent necessary
for innovation" ("Can Obama Bring Back the Trust Busters? [2]" May 17).

Pearlstein seriously misunderstands Chicago-school economics.  Those
economists do not believe that "monopolies are actually good for
consumers."  Quite the contrary.  What the researches of these
economists do reveal, instead, is this: First, competition is so robust
that it is seldom, if ever, squelched by firms who do not enjoy special
government privileges; second, being big and/or extra-efficient does
not make a firm a monopolist; and third, antitrust statutes themselves
have often been used to restrain competition.

It's disappointing that Mr. Pearlstein's understanding of both Chicago-school economics and of antitrust is so superficial.

Donald J. Boudreaux