Unruling Markets: How the Fight Against Monopolies Derailed Globally

Arslan, Melike

doi:https://doi.org/10.21985/n2-hngy-3a67

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Unruling Markets: How the Fight Against Monopolies Derailed Globally

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This dissertation examines the following puzzle: Why have antitrust (competition) laws and policies failed in their mission to prevent concentrations of economic power globally? Corporate monopolization has grown more acute in the last three decades and created serious problems in consumer and worker protection, economic stability, and democratic representation worldwide. Departing from the previous research in economics and management, which emphasizes recent technological and organizational changes to explain monopolies, my study incorporates economic sociology and international political economy perspectives to consider how the monopoly problem is embedded in formal government actions (laws and policies). I unpack this question with three interconnected layers of research while offering a transnational perspective. The first empirical layer examines the historical changes in the US antitrust policy through extensive archival research in the Congressional Records. I show that the US antitrust law reforms responding to the 1970’s economic and intellectual crises unintentionally created a new competition “policy paradigm” more forgiving of corporate monopolization. The second layer analyzes how these formal and enforcement changes in the US national antitrust law regime have shaped the construction of antitrust laws as a global norm that every country with an open, free-market economy must adopt in the 1990s. I argue that non-Western developing economies did not adopt competition laws by themselves in response to domestic economic pressures to organize markets more efficiently. Instead, the free-trade agreements with competition law articles and the growing number of international organizations promoting competition laws led them to adopt these laws. By diffusing competition laws through these mechanisms, the US policymakers sought to “level the playing field” for American corporations. The third and last layer evaluates the adoption and implementation of new competition laws in two important developing countries: Turkey and Mexico. By comparing the Turkish and Mexican competition laws, I found that these laws were designed as “hybrids” of the US and EU competition law models. Even under intense external pressures to conform to these models, the local interest groups and expert professionals in these countries could decide which competition law rules were more relevant to their local contexts. In addition, by compiling and analyzing detailed competition law enforcement data in Turkey and Mexico, I reveal that their competition law implementations were also very different in practice. Relying on 95 interviews with competition law experts and reports of competition authorities, I suggest that these enforcement differences developed due to the match/mismatch between the organizational features of their competition authorities and their juridical court systems. Therefore, policy diffusion cannot ensure that the competition laws adopted by developing countries are implemented similarly in different developing economy contexts. These three layers of research suggest that not only have antitrust rules failed, but they have also actively contributed to the global rise in monopolization in the last four decades. I argue that antitrust laws can take on various interpretations and enforcement styles, thus leading to very different antitrust policies in practice. Some of these policies prevent monopolization, and some contribute to it. More broadly, this research contributes to understanding how legal institutions that assume similar formal goals and written rules change and diffuse.

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