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Assignment 3 - Essay Example

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How effective is the United States antitrust law. Name Institution How effective is the United States antitrust law. The effectiveness of a public policy is determined in terms of the policy’s success in obtaining its specific objectives. This effectiveness is based on the connection between actions of the policy and the observable results (Hylton 2010)…
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Download file to see previous pages The main statutes that make up the antitrust law are the Sherman Act 1890, the Federal State Commission Act of 1914 and the Clayton Act of 1914. These laws are meant to prohibit and restrict the formation of cartels and other activities aimed at restraining trade. They also constrain acquisitions and mergers which would reduce competition. These laws restrict the creation of monopolies that intend to abuse the monopoly power. Antitrust laws are put in place to protect the consumers from greedy business practices by making sure that there is fair competition in the market. The core function of the antitrust provisions is to safeguard the welfare of the consumers. Both the Antitrust Division of the Department of Justice as well as the Federal Trade Commission can bring actions to enforce antitrust laws. State governments can also bring actions to enforce antitrust laws. It is also noteworthy that private civil suits can also be brought to enforce these laws. Public enforcement is, however, more effective as the costs, complexity and overwhelming tasks provide a challenge to private parties considering that enforcement is often against large corporations (Weiser 2005). How the antitrust laws have ensured fair, balanced, and competitive business practices. ...
Among the most notable cases brought under the antitrust law is the disintegration of the AT&T telephone service monopoly in 1982. The company was broken up into one distant company and seven regional companies. The argument for the disintegration was that competition should replace a monopoly for the benefit of both the economy and consumers (Connor, 2006, p. 198). In United States v. Eastman Kodak Company (1921) the court used antitrust law to check the absorption, acquisition and elimination of other enterprises involved in the photographic trade. The court prohibited the procurement of monopolistic raw materials and eliminated the obligation on dealers not to deal with products of competitors. Antitrust law was also significant in preventing a movement to change the motion picture industry into a giant cooperation. In United States v. Fox Theatres Corporation, et al (1948) the court disabled a merger of two main players in the industry. United States v. National Retail Credit Association (1933) also used antitrust law to prevent the elimination of almost three hundred and fifty independent retail credit businesses. A strategy to monopolize the retail credit business in the country had been developed and enforced by the credit association. Members were allocated regions where each was to serve as a monopoly. The other small retail credit businesses were to be removed from the business by policies intended at eliminating their source of credit information. United States v. Kansas City Ice Company also used antitrust law to prevent the destruction of small businesses in the ice trade. The Kansas City Ice Company had acquired control of almost 90% of ice supply through contracts to purchase the whole production of ice ...Download file to see next pagesRead More
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