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Behavioral Firms: Does Antitrust Economics Need a Theoretical Update?

BY | January 9, 2019

By Elizabeth M. Bailey Modern day antitrust analyses are grounded in traditional neoclassical economics theory, assuming consumers and firms are rational, profit maximizing entities. While allowances are made for consumers…

By Elizabeth M. Bailey

Modern day antitrust analyses are grounded in traditional neoclassical economics theory, assuming consumers and firms are rational, profit maximizing entities. While allowances are made for consumers to depart from neoclassical theory in consumer protection, the enforcement of antitrust policies continues to assume firms as rational, profit-maximizing entities. However, empirical literature in finance and economics has provided a growing collection of real world examples

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