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23 Harv. J. L. & Pub. Pol'y 89 (1999-2000)
Externalities in Open Economy Antitrust and Their Implications for International Competition Policy

handle is hein.journals/hjlpp23 and id is 107 raw text is: EXTERNALITIES IN OPEN ECONOMY ANTITRUST AND THEIR IMPLICATIONS FOR INTERNATIONAL COMPETITION POLICY ALAN 0. SYKES* Competition policy has become the subject of increasing international attention, and members of the World Trade Organization (WTO) continue to wrangle over whether to launch formal negotiations on competition policy under WTO auspices. In this paper, I address the wisdom of such negotiations and offer some preliminary thoughts about possible approaches to an international agreement. The theoretical case for international cooperation is a powerful one and rests on the existence of substantial external effects from national antitrust policies in an open economy-an economy with international trade. It is difficult to imagine a mechanism short of international cooperation that could adequately address these important externalities, but ft is also clear that international consensus on optimal antitrust policy is lacking in many particulars. Accordingly, I argue for a modest initial agreement aimed at encouraging all nations to formulate policy with reference to global rather than national welfare concerns where the two conflict. The legal principles most pertinent to that task would include non-discrimination, transparency, and due process requirements. I. NATIONAL ANTITRUST PoLIcY WITH INTERNATIONAL TRADE Every basic microeconomics course teaches the evils of monopoly, using a diagram such as Figure I. The standard exposition runs as follows. * Frank & Bernice J. Greenberg Professor of Law, University of Chicago. This essay is a revised version of oral remarks presented at the Federalist Society Eighteenth Annual Student Symposium at The University of Chicago Law School on April 9-10,1999.

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