Publications: Joe Kennedy

Antitrust advocates allege market-leading “superstar” firms—particularly in digital industries—succeed through anticompetitive conduct. But evidence shows they outperform competitors by investing in innovative technologies and global operations that create more value.

There is a sea change underway in U.S. antitrust policy, and it has the potential to wreak havoc on corporations and harm consumers in the process.

Lax antitrust enforcement has supposedly led to diverse harms such as the stagnation in wages, fewer startups, increased political influence, and reduced innovation. Two of the most important claims are that profits and markups are rising in many industries. But on closer inspection, both claims appear weaker than asserted.

A careful review of both the individual markets and the general issues reveals that the challenges big tech companies pose, while slightly different from previous markets, are not entirely new. Moreover, in most cases legitimate competition policy issues, especially those related to structure, are limited and can be effectively addressed within the confines of existing antitrust law and jurisprudence.

Critics accuse big tech companies of stifling innovation by buying start-ups just to kill them or by exerting such dominance that entrepreneurs don’t want to enter their markets. Neither claim holds up to logic or evidence.

The president-elect’s overall approach to technology and innovation policy appears to be formulated to engage the government as an active partner alongside industry in spurring innovation—but also as a tougher regulator of many tech industries and technologies.

Pundits and activists have looked at the reduced share of U.S. national income going to workers and have simply asserted that the cause is increased market concentration. This assessment is misplaced.

The majority should seize this opportunity to take a deliberative, bipartisan approach to advancing the public interest instead of adopting drastic, ill-advised measures that would harm consumers and deter innovation.

Rather than carefully applying antitrust law to address clear problems, Chairman Cicilline and his Democratic colleagues would seek to restructure markets to achieve significantly more competition. Such a broad attack would harm consumer welfare and inhibit innovation.

Tech policy broadly defined becomes more important each presidential election, and this one is no different. As it has in every cycle since 2008, ITIF provides a side-by-side comparison of the nominees’ positions on key issues related to the progress of technological innovation.