In the previous chapter (and throughout this book), I argued that, by penalizing anticompetitive behavior, antitrust law holds business owners legally responsible for promoting consumer surplus or total welfare. This runs counter to the appropriate conception of free trade in a liberal society, in which commercial transactions should be treated no differently from any other type of human activity—which is to say they should be permitted as long as they do not infringe the rights of others to do the same. The behavior considered to be anticompetitive under antitrust law falls squarely within the business owners’ property rights understood in a moderate, mainstream way, and does not violate any rights of other parties (including consumers and competitors). Nonetheless, such behavior is prohibited, indeed criminalized, because it does not sufficiently contribute to consumer surplus or total welfare.

In this final chapter, we pull back from the fine details to get a general and abstract view of the market, competition, and the government, as it is ideally considered in a liberal democracy that takes the rights of all seriously. As we shall soon see, this view is antithetical to the utilitarian worldview reflected in the economics-oriented and Neo-Brandeisian approaches to antitrust, and in that sense this chapter brings us back to where we began on the first page of this book.

The nature of the market and the role of government

The critique of antitrust law I’ve presented reflects a particular understanding of the purpose of the market and the role of the government in it, which is very different from how economists and antitrust advocates understand them. So we need to ask the question: what is the purpose of the market? (By “the market,” I mean the institutions of commerce, including firms, consumers, and the context in which they trade, whether a physical marketplace or online websites.)

There are two general answers to this question, which reflect different perspectives on how the economy, government, and society interact. The first answer is that the market serves society through generating wealth and well-being: supplying goods and services, employing labor, and creating returns on investment. In other words, the market is an instrument to benefit the members of society, and as such it can and should be regulated to ensure that it creates the most benefit possible.