Totally unproven.
Read Bork's book, "The Antitrust Paradox," the one he wrote before he became a "consultant." Then read the part in Areeda and Turner that talks about natural monopoly. Then come back and tell me about why you still think it's unproven.
Unless, of course, you have regulation to hold down prices, as with the utility companies, bus companies, cable companies, and so forth.
I don't have a crystal ball, but I think that one of the arguments that will be made in this case is that competition, unfettered by government intervention, is the best way to deal with the problems of natural monopoly.
One hint, I think, is in the Liebowitz & Margolis article on Microsoft that I linked to a few million posts ago. There, they say that it is noteworthy that policy makers are increasingly turning to the market and competition to deal with natural monopoly. By this, I think they mean that you leave the natural monopoly, with its excess profits, in place and let competition from potential entrants take its toll. I've seen it argued that this is because true natural monopolies are few and far between, and that, wherever the market goes, antitrust must follow, to make sure that competition is "fair." However, I think the reason Liebowitz & Margolis would say that it is true (and here I may be putting words in their mouths) is because antitrust is not intended or appropriate to deal with natural monopoly, while letting competition take its course is.
Once a company has been allowed to destroy an industry it might be very hard to create a dynamic industry again, and it may require subsidies, protection, and so forth. The infrastructure, the trained workers, the investor interest, the international competitive position all are damaged.
So you are saying what, that antitrust is ineffective?
For the following I just add different emphasis than you did:
>>> The important point is that the market should not be prevented by Microsoft's anticompetitive practices from making that decision.
The question I have for you is, how do you define "market"?
Markets arise spontaneously as a result of the political and legal institutions of a free society, and the methods of competition employed in them are those which are legally sanctioned for all on an equal basis and have shown through experience that they are effective.
Under this definition, the market is already deciding, and we don't need antitrust intervention to allow it to do so.
If you allow antitrust intervention in the form of prohibitions on conduct (as distinct from structural remedies such as breaking up the monopolist), you are not "letting the market decide," but are rigging the game to favor one set of players over another (whether you intend to or not). You limit methods of competition, thereby limiting the ability of market participants to experiment and innovate in methods of competition. You impose costs, most of which you will not be aware of because they are long-term and impossible to discern in advance.
For these reasons, I also have a hard time understanding what Warren-Boulton means by a "market test." He seems to treat the market like some sort of experiment, and the participants as laboratory rats.
A classic example of "constructivist rationalism" if ever I saw one.
With remedies like these so easily available (we know they work) you can hardly say the OS is a natural monopoly.
You are confusing the phenomenon with the remedy.
And, you need to at least back up the statement, "we know they work." I have serious doubts you can do that. What are the known costs and side-effects? |
