In 1890, Senator Sherman (of the Sherman Antitrust Act, which we mentioned earlier)

pushed through the legislation that bears his name, which gave the government significant power to “bust up” cartels, presumably in order to increase output. More than a century later, economist Thomas J. DiLorenzo examined the industries commonly accused of being cartels and found those industries increased output by an average of 175% from 1880 to 1890—seven times the growth rate of the economy at the time.

Suppose the industries were conspiring.

Indeed, let’s suppose that these cartels grew ever-stronger in the decade before the Sherman Act became law. If that were true, would we expect output in these industries to grow by so much? In other words, is DiLorenzo’s evidence consistent with the standard story of the Sherman Antitrust Act? nj5