Economics a contemporary introduction Chapter 15

354 Part 5 Market Failure and Public Policy 3. Regulating Natural Monopolies What is the "regulatory dil- 6. Antitrust Law and Enforcement Discuss the difference emma" ? That is, what trade-offs do regulators have to consider between per se illegality and the rule of reason. when deciding how to control a natural monopoly? 7. Antitrust Activity "The existence of only three big U.S. auto man- + Theories of Regulation Why do producers have more interest ufacturers is evidence that the market structure is anticompetitive in government regulations than consumers do? and that antitrust laws are being broken." Evaluate this assertion. a. Compare and contrast the public-interest and special-interest 8. Mergers and Public Policy Under what circumstances, and theories of economic regulation. What is the capture theory why, would the government be opposed to a merger of two of regulation? firms? How does the Justice Department decide which mergers b. Which theory best explains the government's case against to challenge? Microsoft? 9. Competitive Trends in the U.S. Economy William Shepherd's 5. Monopoly and Competition Under what conditions would study of U.S. industries showed a clear increase in competi- monopoly be a more efficient outcome for a market than would tion in the U.S. economy between 1958 and 2000. How did competition? Shepherd explain this trend? WiBmmua Problems and Exercises