The new labor antitrust and the problem of superstar firms ⭐️ Eric A. Posner

Recent studies show that labor markets are highly concentrated and that employers engage in practices that harm competition and suppress wages, such as no-poaching agreements, wage-fixing or mergers. Why has antitrust failed in the labor market? What are the implications of this failure for society and democracy and what strategies for judicial legislative reform are indicated?

Eric A. Posner is the Kirkland and Ellis Distinguished Service Professor of Law and Arthur and Esther Kane Research Chair at University of Chicago Law School. Since 2022, he has been counsel to the Assistant Attorney General, Antitrust Division. He is also a fellow of the American Academy of Arts and Sciences and a member of the American Law Institute. His research interests include antitrust law, international law, and constitutional law. His most recent books are How Antitrust Failed Workers (2021) and The Demagogue’s Playbook (2020).

https://www.ubscenter.uzh.ch/en/news_events/events/2022-11-07_superstar_firms_threat_for_competition_and_democracy.html

Since 1980, the world economy has experienced an increase of dominant firms. Dominant firms face limited competition in their market and exert monopoly power. Why has this happened, and why did it start in 1980? The rise of dominant firms has a direct impact on customers who pay higher prices, but it also has far-reaching implications for the macroeconomy. Widespread market power leads to wage stagnation and a decline in the labor share, it increases wage inequality, it slows down business dynamism, it reduces the number of startup firms and lowers innovation.

In the public paper 'Dominant firms in the digital age', Jan Eeckhout reviews the determinants of the rise of dominant firms, discusses the causes and consequences, and proposes directions for policy solutions.

https://www.ubscenter.uzh.ch/en/publications/public_papers/dominant-firms-in-the-digital-age.html

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