Is Antitrust Too Complicated for Generalist Judges? The Impact of Economic Complexity and Judicial Training on Appeals

Modern antitrust litigation sometimes involves complex expert economic and econometric analysis. While this boom in the demand for economic analysis and expert testimony has clearly improved the welfare of economists—and schools offering basic economic training to judges—little is known about the empirical effects of economic complexity or judges' economic training on decision-making in antitrust litigation. We use a unique data set on antitrust litigation in district courts during 1996—2006 to examine whether economic complexity impacts decisions in antitrust cases, and thereby provide a novel test of the frequently asserted hypothesis that antitrust analysis has become too complex for generalist judges. We also examine the impact of one institutional response to economic complexity - basic economic training by judges. We find that decisions involving the evaluation of complex economic evidence are significantly more likely to be appealed, and decisions of judges trained in basic economics are significantly less likely to be appealed than are decisions by their untrained counterparts. Our results are robust to a variety of controls, including the type of case, circuit, and the political party of the judge. Our tentative conclusion, based on a revealed preference argument that views a party’s appeal decision as an indication that the district court got the economics wrong, is that there is support for the hypothesis that some antitrust cases are too complicated for generalist judges.antitrust, Daubert, complexity, economic training, expert witness

Guiding Section 5: Comments on the Commissioners

FTC Commissioners Joshua Wright and Maureen Ohlhausen have proposed that the Commission adopt Guidelines for the application of Section 5 to Unfair Methods of Competition. This short note comments on the role of Section 5 distinct from the Sherman Act. It suggests that Section 5 be used to attack and deter certain conduct that falls into gaps of the Sherman Act. This includes exclusionary unilateral conduct that likely leads to the achievement, enhancement, or maintenance of market power (as opposed to monopoly power). It also includes unilateral conduct such as invitations to collude and other practices that facilitate conscious parallelism, tacit or express collusion, but are not uniquely or sufficiently “unequivocal” or “consequential” to violate Section 2. The comment also explains why a limitation of Section 5 only to conduct with zero cognizable efficiency benefits would neutralize Section 5 and lead to under-deterrence problems and why a disproportionate harm standard also is problematical

Rhinocheilus, R. lecontei

Number of Pages: 4Integrative BiologyGeological Science

The Appropriate Legal Standard and Sufficient Economic Evidence for Exclusive Dealing under Section 2: the FTC’s \u3ci\u3eMcWane\u3c/i\u3e Case

The FTC recently found McWane, Inc. liable for unlawful monopoly maintenance by a 3-1 majority. The dispute among the FTC Commissioners raises important and interesting issues regarding the law and economics of exclusive dealing and the proper evaluation of the competitive effects of exclusionary conduct. Commissioner Wright’s Dissent proposes and utilizes a new legal standard that requires the plaintiff to show “clear evidence” of harm to competition before shifting the burden to the defendant to show procompetitive efficiency benefits. This burden of proof and production on the plaintiff is much higher than showing “probable effect” based on a preponderance of the evidence standard. Application of this higher burden to interbrand exclusivity restraints by monopolists is not supported either by the case law, economic theory or empirical evidence. In evaluating harm to competition, this legal standard places no weight on certain important factors, including the fact that McWane was a monopolist with the explicit purpose of raising the costs and reducing the distribution of its only competitors. His proposed standard also does not consider whether McWane’s efficiency claims were valid, in the absence of other clear evidence of competitive harm. Commissioner Wright limits his economic analysis to only a single possible mechanism of exclusionary effect, whether the entrant was prevented from reaching minimum efficient scale of production, rather than a broader analysis of whether the entrant’s costs were raised or whether its ability to expand output was so limited by the exclusives that it was unable to prevent the maintenance of McWane’s monopoly pricing. Commissioner Wright also fails to credit the direct evidence of price effects found by the Commission. In our view, this proposed type of legal standard and economic approach is not an “enquiry meet for the case.” It creates a serious risk of leading to false negatives, under-enforcement and under-deterrence

Engineering fidelity echoes in Bose-Hubbard Hamiltonians

We analyze the fidelity decay for a system of interacting bosons described by a Bose-Hubbard Hamiltonian. We find echoes associated with "non-universal" structures that dominate the energy landscape of the perturbation operator. Despite their classical origin, these echoes persist deep into the quantum (perturbative) regime and can be described by an improved random matrix modeling. In the opposite limit of strong perturbations (and high enough energies), classical considerations reveal the importance of self-trapping phenomena in the echo efficiency.Comment: 6 pages, use epl2.cls class, 5 figures Cross reference with nlin, quant-phy

A path integral formulation of the Wright-Fisher process with genic selection

The Wright-Fisher process with selection is an important tool in population genetics theory. Traditional analysis of this process relies on the diffusion approximation. The diffusion approximation is usually studied in a partial differential equations framework. In this paper, I introduce a path integral formalism to study the Wright-Fisher process with selection and use that formalism to obtain a simple perturbation series to approximate the transition density. The perturbation series can be understood in terms of Feynman diagrams, which have a simple probabilistic interpretation in terms of selective events. The perturbation series proves to be an accurate approximation of the transition density for weak selection and is shown to be arbitrarily accurate for any selection coefficient.Comment: 22 pages, 3 figure