A PYMNTS Company

Antitrust Law and Distributive Politics in the American States

By  |  September 14, 2014

Posted by Social Science Research Network

Antitrust Law and Distributive Politics in the American States – Colin Provost

ABSTRACT: State enforcement by state attorneys general (AGs) has become a major component of American antitrust law. Much has been written about state antitrust enforcement, but existing accounts of AG incentives and behavior are incomplete. As elected officials in forty?three states, AGs must represent their constituents and, therefore, will be drawn to cases that maximize the level of settlement reward—cases with large, wealthy defendants. I hypothesize and find that state AGs represent their constituents along ideological lines, but this relationship is conditioned by case characteristics that involve the potential settlement reward. Moreover, incentives to participate are likely to be higher when there are clear violations of the law, as in price?fixing cases, rather than in merger cases, where no wrongdoing has necessarily been established. The study adds to our understanding of antitrust law but also has implications for how distributive politics shapes political responsiveness to the electorate.