In The Unsound Theory Behind the Consumer (and Total) Welfare Goal in Antitrust, a working paper for the Roosevelt Institute, University of Utah economics professor and antitrust scholar Mark Glick examines why the New Brandeisians are correct to reject the consumer welfare (CW) standard. Delving deeper—and pushing antitrust scholarship forward—he argues that the CW or total welfare standard was theoretically flawed and acutely insufficient from its inception.
Ultimately, Glick demonstrates that, since its adoption in the 1970s, the CW standard never offered a coherent goal for antitrust; what antitrust regulators and enforcers mean by “consumer welfare” was, and remains, unclear and contradictory. For example, the lack of a coherent definition of CW undermines many of the standard antitrust theories such as the Williamson Tradeoff for merger analysis. On merits alone, independent of its economic impact, the consumer welfare standard should be rejected.
An extended version of this paper is scheduled to appear in The Antitrust Bulletin.