Working Paper No. 04-18:
State Intervention/State Action — A U.S. Perspective

Author(s):

Timothy Muris

Date Posted: 2004

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Abstract:

This article discusses the importance of developing a comprehensive competition policy, which addresses both private and public restraints of trade. 

The first section discusses the importance of devoting substantial resources to opposing public restraints.  If one creates a system in which private price fixing results in a jail sentence, but accomplishing the same objective through government regulation is always legal, one has not completely addressed the competitive problem, but has simply dictated the form that it will take.

Second, the article emphasizes the need to use a multi-faceted strategy that invokes a broad range of policy instruments.  For example, the FTC has used the full range of its tools, including competition advocacy, amicus briefs, and litigation — to address the problem of public restraint in the U.S., devoting particular attention to competition advocacy and litigation.  Regarding competition advocacy, this section describes the successes the FTC has had in combating anticompetitive professional licensing, advertising restrictions, and barriers to e-commerce.  Regarding litigation, it outlines the work of the FTC's State Action Task Force and the Commission's efforts to implement the recommendations of the Task Force Report through the South Carolina Board of Dentistry case and a series of cases involving intrastate household goods movers. 

The third section underscores the need for competition agencies to build new institutional relationships with other government bodies whose decisions involve the competitive process.  For example, the U.S. is striving to emulate the success of the European Commission's campaign against government intervention in the economy.  It  concludes with the observation that, though the multiplicity of competition policy regimes presents significant difficulties, it also presents an extraordinary opportunity to learn from comparative study.