That could not be further from the truth. The Progressives are occasionally caricatured as people who really did not care about costs and productivity but were concerned exclusively about bigness as such. Even so, the neoliberal revolution adopted most of these tools, although it modified some of them and rejected a few. Nearly all of these developments placed antitrust theory on an expansion course that prevailed until the reaction against the New Deal found a voice in the neoliberalism of the 1940s, particularly as expressed by the Chicago School. The record of their engagement with the law is impressive judges routinely used them even if they were not aware of their economic origins or technical meaning. Consistent with the economic-focused language of the Sherman Act itself, the tools that emerged were mainly economic, although they were applied by non-economist lawyers and judges. That came later as litigants and courts looked for tools that would enable them to assess practices in a coherent way. The legislative debate leading up to the Sherman Act can hardly be characterized as a dispute about economic theory. The new theoretical developments were the rise of marginalist economics and industrial organization theory, which provided competition analysts with a set of tools like none they had before. The new sources of concern were industrialization, the rise of modern distribution, the labor movement, and the increasing importance of consumers as market participants. The emergent interest groups were large multistate business, the trade association movement dominated by small business, 2 consumers, and labor. It reflected the emergence of new interest groups as well as new sources of economic concern and theoretical developments. The Progressive Era antitrust movement was both political and economic. Antitrust policy would have looked very different had it developed a half century earlier. The passage of the Sherman and Clayton Acts and the development of techniques for evaluating practices tracked extraordinary developments in technology as well as social and economic thought. The extraordinary Progressive influence on antitrust policy was at least partly a historical coincidence. In fact, after decades of experimentation we are reclaiming much of it. For all intents and purposes, they invented antitrust law. 1 During this period a diverse group of policy makers developed nearly all of the analytic tools that antitrust law uses today to evaluate business practices or market structures thought to be anticompetitive. The long American Progressive Era to the New Deal, roughly 1900 into the early 1930s, was the formative age of antitrust policy. Eventually it moderated, reaching a point that is not all that far away from the Progressives’ original vision. Then, two decades later it turned just as sharply to the right. Subsequent to 1930, antitrust policy veered sharply to the left. Finally, at the end of this period came (6) theories of imperfect competition, including the rediscovery of oligopoly theory and the rise of product differentiation as relevant to antitrust policy making. The principal contributions the Progressives made to antitrust policy were (1) partial equilibrium analysis, which became the basis for concerns about economic concentration, the distinction between short- and long-run analysis, and later provided the foundation for the development of the antitrust “relevant market” (2) the classification of costs into fixed and variable, with the emergent belief that industries with high fixed costs were more problematic (3) the development of the concept of entry barriers, contrary to a long classical tradition of assuming that entry is easy and quick (4) the distinction between horizontal and vertical relationships and the emergence of vertical integration as a competition problem and (5) price discrimination as a practice that could sometimes have competitive consequences. In a very real sense, we can say that this group of people invented antitrust law. During that period courts and Progressive scholars developed nearly all of the tools that we use to this day to assess anticompetitive practices under the federal antitrust laws. The long Progressive Era, from 1900 to 1930, was the Golden Age of antitrust theory, if not of enforcement.
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