Organization, Control, and the Single Entity Defense in Antitrust

Journal of Competition Law & Economics, August 2009

Posted: 9 Aug 2009

Multiple version iconThere are 2 versions of this paper

Date Written: August 5, 2009

Abstract

Since at least the 1930s, economists have puzzled over how to delineate the boundaries of a firm. With the advent of antitrust legislation in 1890, American courts have been pressed to consider what constitutes conspiracies between corporate entities to restrain commerce. By the 1980s, courts started to characterize conspiracies by negation - that is, by extending the status of 'single entity' to certain types of agglomerations. Efforts both in economics and in the law to sort out what constitutes a 'firm' or 'single entity' have focused on 'control.' A difficulty is that neither the law nor economics offers an operationally significant concept of control. Even so, both the law and economics contribute concepts other than control that provide a way of understanding economic organization. These concepts - adaptation and control rights - suggest how one can subsume the sometimes confusing array of single entity tests proposed in the case law within a two-stage sequence of tests.

Keywords: Adaptation, Control Rights, Single Entity, Theory of the Firm

JEL Classification: D23, K21, L49

Suggested Citation

Williamson, Dean V., Organization, Control, and the Single Entity Defense in Antitrust (August 5, 2009). Journal of Competition Law & Economics, August 2009 , Available at SSRN: https://ssrn.com/abstract=1444324

Dean V. Williamson (Contact Author)

Independent ( email )

Washington, DC
United States

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