or services, lower quality of products, and less innovation. Some mergers create a concentrated market, while

others enable a single firm to raise prices.” The challenge for the antitrust regulators at the FTC and the U.S.

Department of Justice is to figure out when a merger may hinder competition. This decision involves both

numerical tools and some judgments that are difficult to quantify. The following Clear It Up explains the

origins of U.S. antitrust law.

CLEAR IT UP

What is U.S. antitrust law?
In the closing decades of the 1800s, many industries in the U.S. economy were dominated by a single firm that had

most of the sales for the entire country. Supporters of these large firms argued that they could take advantage of

economies of scale and careful planning to provide consumers with products at low prices. However, critics pointed

out that when competition was reduced, these firms were free to charge more and make permanently higher profits,
{"file_name": "Microeconomics3e.pdf", "uploaded_via": "batch_uploader", "creator": "PDFMiner", "source": "downloads\\business\\economics\\Microeconomics3e.pdf", "file_size_mb": 26.99, "file_hash": "830b81f41611ac67a490444dbb5d6aed292224606965b06965b914443c93331a", "file_type": ".pdf", "moddate": "2022-12-07T14:23:05-06:00", "batch_upload": true, "creationdate": "2022-12-07T14:15:44-06:00", "upload_timestamp": "2026-02-07T15:37:44.339247", "source_file": "downloads\\business\\economics\\Microeconomics3e.pdf", "producer": "Prince 14.2 (www.princexml.com)", "total_pages": 597, "title": "Principles of Microeconomics 3e"}