The development of marginalist, or neoclassical, economics led to a fifty-year long crisis in competition theory. Given an industrial structure with sufficient fixed costs, competition always became “ruinous,” forcing firms to cut prices to marginal cost without sufficient revenue remaining to pay off investment. Early neoclassicists such as Alfred Marshall were not able to solve this problem, and as a result many economists were hostile toward the antitrust laws in the early decades of the twentieth century. The ruinous competition debate came to an abrupt end in the early 1930’s, when Joan Robinson and particularly Edward Chamberlin developed models that took product differentiation into account. The emergent theory of monopolistic competition came with its own problems, however—namely, “excessive” product variety and advertising, chronic excess capacity, and prices above short-run marginal cost. In sharp contrast to the ruinous competition model, the monopolistic competition model called for aggressive antitrust enforcement. This change of model largely explains the Roosevelt administration’s abrupt shift in antitrust policy between the First and Second New Deals. Only with John Maurice Clark’s theory of workable competition in 1940 and the Mason-Bain structure-conduct-performance paradigm developed in the 1950s did neoclassical competition theory begin to reach a new equilibrium that attempted to calibrate the amount and kind of competition policy necessary to produce satisfactory results in diverse markets. The subsequent debate between Harvard structuralism and the emergent Chicago School occurred largely within this paradigm.
News & Events
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Volume 97 Lead Piece Profiled in New York Times
The Volume 97 Lead Piece, a study of how the Supreme Court treats business interests by distinguished legal scholars Lee Epstein, William M. Landes, and Richard A. Posner, was profiled in the May 5, 2013 edition of the New York Times. The story, titled Corporations Find a Friend in the Supreme Court, [...]
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Volume 98 Spring Submissions Closed
The Minnesota Law Review has closed the spring submissions period for Volume 98. Submissions for Volume 98 will reopen on Thursday, August 1. Please see the submissions page for more details.
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Volume 98 Submissions Will Open Feb. 15
The Minnesota Law Review will begin accepting submissions for Volume 98 on Friday, February 15, 2013. Please see this page for more details.
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Minnesota Law Review Announces Volume 98 Editorial Board
The Minnesota Law Review is pleased to announce its Volume 98 editorial board, headed by Editor in Chief Jake Vandelist.
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Minnesota Law Review Announces 2013 Symposium Topic
The Minnesota Law Review is pleased to announce that its 2013 symposium will address the legal and political issues facing organized labor in the United States. The symposium will be held at the University of Minnesota Law School on October 25, 2013.
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