Antitrust Law & Trade Regulation

Antitrust Law & Trade Regulation
Summer 2014 – ECON 3090 Section 092
Monday, Tuesday, & Thursday 6:00 - 8:30
Classroom: Friday 107
Jonathan Perry
Office Information:
Union County District Attorney's Office - Monroe
369-I Cone Center, Honors Office UNC Charlotte
Phone: 704-654-5555; 704-698-3192
Email Contact: jwperry@uncc.edu
Office Hours: after class when available and making arrangements prior to the class meeting
Description of the Course:
This course will examine the legal framework regulating the operation of the competitive market in the
United States and North Carolina. The recent financial crisis has resulted in a growing public discussion of
the nature of government regulation of the free market, and students will learn about the general purpose,
historical background, and current applicability of antitrust law in the modern economy. Law and
economic theory will be discussed equally throughout this course, drawing on the industrial organization
literature in economics as well as antitrust law. Students will ask and answer questions related to
regulation of business behavior, the operation of the price mechanism and free markets, and monopolies
and cartels. In this course, students will learn the tools that regulators have available in their kits used to
understand the business environment, from measurements of market structure to market concentration and
monopoly power. We will also study anticompetitive behavior and the exceptions to antitrust regulation, as
well as assess the ability of the law to keep up with new technologies and business practices.
COURSE POLICIES
DIVERSITY STATEMENT: The Belk College of Business strives to create an inclusive academic
climate in which the dignity of all individuals is respected and maintained. Therefore, we celebrate
diversity that includes, but is not limited to ability/disability, age, culture, ethnicity, gender, language, race,
religion, sexual orientation, and socio-economic status.
ACADEMIC INTEGRITY: Students have the responsibility to know and observe the requirements of The
UNCC Code of Student Academic Integrity. This code forbids cheating, fabrication or falsification of
information, multiple submission of academic work, plagiarism, abuse of academic materials, and
complicity in academic dishonesty. Any special requirements or permission regarding academic integrity in
this course will be stated by the instructor, and are binding on the students. Academic evaluations in this
course include a judgment that the student's work is free from academic dishonesty of any type, and grades
in this course therefore should be and will be adversely affected by academic dishonesty. Students who
violate the code can be expelled from UNCC. This normal penalty for a first offense is zero credit on the
work involving dishonesty and further substantial reduction of the course grade. In almost all cases the
course grade is reduced to F. Copies of the code can be obtained from the Dean of Students Office.
Standards of academic integrity will be enforced in this course. Students are expected to report cases of
academic dishonesty to the course instructor
ATTENDANCE: Attendance is mandatory, and I will take attendance at the beginning of every class.
You may not miss classes without suffering the consequences set forth in the Student Rights and
Responsibilities Manual. Come to class on time for a number of reasons, not least as a courtesy to your
fellow students and me. I reserve the right to consider you absent if you are not present when I take
attendance at the beginning of class. PLEASE ARRIVE ON TIME - there will be times when I am NOT
able to arrive exactly on time and there will be activities for you to complete before I arrive facilitated by
our unofficial TA students.
CLASS PARTICIPATION: I expect you to have done the assigned reading and to be fully prepared to
participate. You should not hesitate to ask questions or contribute to any ongoing discussion. I will not
hesitate to prompt those of you who are less forthcoming. You may earn points on your final grade for
outstanding participation, and I reserve the right to deduct points from your final grade if you are
repeatedly unprepared, excessively tardy or simply do not participate. Also - this class will involve
discussion and exchange of ideas; this is to be carried out in a respectful, courteous, and non-chaotic
manner.
LAPTOPS: Students who take notes on a computer frequently fall into the trap of transcribing the
lecture...It is also very easy to become distracted by e-mail or instant messaging, the Internet, or other
computer applications and to miss what is happening in the classroom. Students have told me in prior
semesters that having fellow students around them on e-mail, IM, Facebook, and the Internet is distracting
and disruptive. In addition, I have noticed that students who are using the Internet frequently ask me to
repeat what I have said, which slows us down as a class. For that reason, do not use the Internet (including
IM and e-mail applications) in class. Violations will be penalized as noted above for lack of class
participation. To be clear: Laptops should NOT be used unless authorized for class activities.
PLEASE SEE ME IF THIS PRESENTS A PROBLEM. Since this is a seminar class and notes will often
involve drawing and graphs, laptops will be of limited utility anyway.
PHONES: Except in the case of emergency, please turn cell phones to silent mode prior to class. If an
emergency requires you to keep your phone on ring, please let me know prior to class.
RECORDING CLASS SESSIONS: Not Allowed. See me if you have questions about this.
Textbooks(s):
(1) The Antitrust Laws: A Primer [4th Edition]
John H. Shenefield & Irwin M. Stelzer, 2001
The American Enterprise Institute Press
ISBN# 0844739421
THIS TEXT AVAILABLE ONLINE: http://www.aei.org/files/2001/12/01/20040217_book14.pdf
(2) Antitrust: The Case for Repeal [Revised 2nd Edition]
Dominick T. Armentano, 1999
The Ludwig von Mises Institute
ISBN# 0945466250
THIS TEXT AVAILABLE ONLINE: http://library.mises.org/books/Dominick Armentano/Antitrust The
Case for Repeal.pdf
(3) Free Markets Under Siege: Cartels, Politics, & Social Welfare
Richard A. Epstein, 2005
Hoover Institution Press
ISBN# 0817946128
THIS TEXT AVAILABLE ONLINE: http://www.hoover.org/publications/books/8346
Additional Articles/Cases: To be provided...
Course Notes From Professor: To be provided via Moodle / Email
Course Evaluation: assessments will include:
1. Student Participation/Short Writing Assignments (30%): Each student will be responsible for
participating throughout the course of the semester in several in-class exercises and short writing
assignments, which will be geared towards helping you understand the basics of markets and their
regulation. These short assignments will include:
a. Short writing exercises (SWE's) (1-2 pages) (20%). These are short essay responses to
questions on one specific topic
b. Additional Classroom Economics Exercise(s) & Participation (10%). We will have
several exercises in class that will require you to participate; points will also be
awarded for great efforts put forth!
2. First & Second Written Assessments (30%) - these will be take home, open book and notes
written assessments with several days to respond to the questions posed. I expect these written
assessments to be at a minimum several pages each.
3. Final Essay/Brief (25%) - This will be an analysis of a current case from the world of antitrust
litigation, and for the assignment you will be asked to apply the principles of both antitrust and
economics to assess a particular point of view expressed through the briefs and other supporting
documentation.
4. "Issue" Presentation (15%) - we will have three distinct areas of the law and economics within
the class that are suitable for discussion and presentations - (1) the Microsoft case; (2) the
Financial Crisis; and (3) the overall efficacy role of regulation in the economy. Students will be
broken into small groups and for their topic on the night it is discussed will be responsible for a
brief presentation and leading some of the discussion.
Course Assignments - Summer 2014
Date
Topic
Reading Assignment / Class Activity-Assignment
7/1
Introduction to the course; discussion of
syllabus and assignments; discussion
Fair Fight In the Marketplace
OBJECTIVES: To understand the
purposes of studying antitrust law and trade
regulation; understand some basic ideas
about the field.
Antitrust Worldview, Part I
7/3
The Origins and Objectives of Antitrust
Law & Trade Regulation: Fundamental
statutes, institutions, and procedures of
antitrust law
OBJECTIVES: To understand where the
antitrust law comes from and its purposes;
understand the debate over the fundamental
question(s) of economics & how they relate
to trade regulation law
Class Seat Auction Exercise
Epstein
Armentano 1
Shenefield 1,2,3,4
KEY TERMS: Sherman Act; Clayton Act;
Federal Trade Commission Act;
7/7
Economics & Antitrust
OBJECTIVES: To understand how
economic theory and tools help illuminate
the relationship between the government
and the market; what economic theory can
tell us about how markets work
(normatively and positively)
Armentano 3
Shenefield 5
Adam Smith: Wealth of Nations
KEY TERMS: Industrial Organization;
Game Theory;
7/14
Markets & Market Power
Armentano 3
Shenefield 5
OBJECTIVES: To understand how the
law defines markets, and market power
KEY TERMS: Market Power; HHI;
7/15
Monopolization & Monopolistic Behavior
Armentano 4
Shenefield 6
OBJECTIVES: To understand how firms
can act in unacceptable antitrust lawdefined ways; to define what monopolies do
and why they are controversial
KEY TERMS:; Monopolization;
7/17
7/21
7/22
Presentations/Class Discussion:
US v. Microsoft
Presentations
Compliance With Antitrust Law
OBJECTIVES: To understand how
businesses put in place procedures to ensure
compliance with the antitrust laws
GUEST SPEAKER: TBA
Collusion & Joint Behavior (A Firm &
Other Firms)
Armentano 6
Shenefield 7,8
OBJECTIVES: To understand regulation
of the firm's relationship with other firms in
the market(s)
Airline Pricing exercise
KEY TERMS: Price-fixing; Market
Division; Horizontal Agreements
Shenefield 13
7/24
Firms & The Consumer
Armentano 5
Shenefield 9
OBJECTIVES: To understand regulation
of the firm's relationship with consumers
KEY TERMS: Vertical restraints; Price
Discrimination;
7/28
Trade Regulation & The Financial Crisis
OBJECTIVES: To understand what role
trade regulation law has played in the
context of the financial crisis
Inside Job
7/29
Trade Regulation & The Financial Crisis,
Continued
Presentations
7/31
Antitrust Law & Intellectual Property
8/4
OBJECTIVES: To understand how
antitrust law affects intellectual property
and business-related activities
Shenefield 10
State & Private Antitrust Enforcement
Action(s)
Shenefield 11
OBJECTIVES: To understand how the
states and private individuals play roles in
the regulation of trade
8/5
Final Considerations: The Role of the
Government & Regulation of the Market
Presentations
OBJECTIVES: To assess where the
antitrust and trade regulation laws leave us
in terms of their goals and operation; how
well are free markets reined in by the
government, in terms of appropriateness
and overall efficiency?
8/8
NO CLASS
FINAL EXAMINATION/ESSAY DUE
Armentano Denotes chapters that can be found in Antitrust: The Case for Repeal
Epstein
Denotes chapters in Free Markets Under Siege
Shenefield Denotes chapters that can be found in The Antitrust Laws: A Primer