ABA doesn't like competition between lawyers for business, nix that advertising

ABA doesn't like competition between lawyers for business, nix that advertising

lawyers Monopoly

At least in North Carolina (and I presume many other states), the ABA has released a finding that advertising through Groupon is an ethics violation.

Groupon is known for its great deals on everything from restaurant meals to oil changes, but can it ethically be used by law firms seeking new business?

An ethics subcommittee of the North Carolina State Bar will be considering the issue, according to assistant ethics counsel Suzanne Lever. She tells the ABA Journal the matter was sent to the subcommittee at a meeting Thursday.

Groupon allows consumers to pay one price up front for a service that is more valuable. A restaurant, for example, may offer a $50 meal for $25 that is paid immediately. One law firm that used Groupon, the Law Offices of Craig S. Redler & Associates in St. Louis, offered to provide a will and durable power of attorney for $99. . . .

Obama's crazy anti-trust enforcement

Obama's crazy anti-trust enforcement

Monopoly

This is just the beginning of the cases.

The cooperative said that in 2008, it marketed 61.2 billion pounds of milk, representing 32% of the total milk marketed in the country. . . .

The problem isn't the level of concentration. The political problem is that milk prices are down, but that is not because of a sudden increase in concentration.

Dairy farmers nationwide are coping with historically low milk prices after a 36% drop in the past year to the lowest level in three decades. In 2007 and part of 2008, dairy farmers enjoyed high milk prices as a booming global economy boosted demand for milk around the world. Dairy farmers expanded their herds to cash in. Then, with the onset of the recession, demand for milk weakened and dairy farmers were left with an oversupply of milk, which depressed prices. . . .

Possibly someone can also explain to me how a coop conspires to lower the price it pays to its members who own the coop. Even if it somehow accomplished this, don't the members get the "ill gotten gains" back at the end of the year?

The Economist magazine on Predatory Pricing

The Economist magazine on Predatory Pricing

Monopoly predation

The Economist magazine points to the skepticism that economists have about predatory pricing. I wish that they would have would have noted that the one place where predatory pricing is most likely to take place is government enterprises.

I couldn't agree more with this quote:

TWO decades before he won the Nobel prize for economics in 1991, Ronald Coase wrote an essay decrying the poor state of research in industrial organisation, the discipline in which he established his reputation. The field, he complained, was devoted to the study of monopoly and antitrust policy. That, he said, made for bad scholarship: an economist faced with a business practice that he cannot fathom, according to Mr Coase, “looks for a monopoly explanation”.

It has always struck me as odd that anything that economists see the first explanation is some type of monopoly power.

Some REALLY bad economics on global warming

Some REALLY bad economics on global warming

Economics Environment GlobalWarming Monopoly

From the Marginal Revolution:

A simple idea for fighting global warming

Repeal the [should have read: "Institute an"] antitrust exemption for the airlines and approval all of their mergers, no matter what.

Higher P, lower Q. And maybe some groups outside the traditional green coalition would support such a change.

By no means a full solution, but maybe better than doing nothing.

Posted by Tyler Cowen

This post makes multiple serious errors. It assumes that mergers create inefficiencies. While it is surely possible that mergers can raise prices, it is also quite likely that mergers increase efficiency, ensure that products can be produced more cheaply, and lower prices. Indeed, mergers can both lower production costs but still increase prices if the increase in monopoly power is large enough. But I know of no real evidence that mergers tend to increase prices. Despite what Tyler is claiming, I know of no reason to believe anti-trust enforcement is competent at determining which mergers increase efficiency and which ones do not. If Tyler thinks that the government is particularly good at discerning mergers that are efficiency creating and those that aren't, he should point to it. Indeed, George Stigler argued that the Sherman Act was passed to protect less efficient firms from competition by more efficient ones (Stigler, George J. 1985. "The Origin of the Sherman Act," Journal of Legal Studies, 1985, 14:1-11). At least as far back as Demsetz's 1973 paper, economists have provided evidence that increased firm size is most likely to arise from increased efficiency (Demsetz, Harold. "Industry Structure, Market Rivalry, and Public Policy." Journal of Law and Economics 16 (April 1973): 1-9).

While not errors of the same magnitude of simple poor logic, it is too bad to see that Tyler accepts the assumption that we need to do something more about global warming.