US antitrust policy takes as its objective consumer welfare, not total economic welfare. With that objective, Joe Bain's definition of entry barriers is more useful than George Stigler's or definitions based on economic welfare. It follows that economies of scale that involve sunk costs may create antitrust barriers to entry. A simple model shows that sunk costs without scale economies may discourage entry without creating an antitrust entry barrier.
| Identifer | oai:union.ndltd.org:MIT/oai:dspace.mit.edu:1721.1/5060 |
| Date | 02 April 2004 |
| Creators | Schmalensee, Richard |
| Source Sets | M.I.T. Theses and Dissertation |
| Language | en_US |
| Detected Language | English |
| Type | Working Paper |
| Format | 194770 bytes, application/pdf |
| Relation | MIT Sloan School of Management Working Paper;4457-04 |
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