Public choice theory

Public Choice (2010) 142: 385–406 DOI 10.1007/s11127-009-9552-6

Public choice theory and antitrust policy
William F. Shughart II · Fred S. McChesney

Received: 16 September 2009 / Accepted: 14 October 2009 / Published online: 27 October 2009 © Springer Science+Business Media, LLC 2009

Abstract We survey the pioneering contributions of Robert Tollison to the theory and practice of antitrust law enforcement. Inspired by his period of service during Ronald Reagan’s first administration as Director of the Federal Trade Commission’s Bureau of Economics, Tollison was the first scholar to apply public choice reasoning to the question why antitrust frequently fails to achieve its stated goal of protecting consumers against unwarranted exercises of market power. In supplying evidence that the outcomes of antitrust processes are shaped more by special interests than by the public’s interest, he was instrumental in launching a wholly new research program. Keywords Antitrust policy · Interest-group theory of government · Public choice · Federal Trade Commission 1 Introduction Robert Tollison is the original freakoconomist. Long before Steve Levitt and his journalist co-author were ensconced on the best-seller list (Levitt and Dubner 2006), Bob was extending the frontiers of positive economic science in previously unexplored directions. His fertile, Virginia-trained mind conceived ways of applying the economist’s toolkit to the industrial organization of the Medieval Catholic Church; to the causes and consequences of economic and social regulation; to voting, legislative processes, the executive and judicial branches of government; to interest-group politics; to constitutional political economy; to college and professional sports; to deficit finance; to the history of economics and economic history; to rent seeking; to the growth of government; to immigration; to the Federal Reserve; and too many more to list. We know Bob Tollison and we know Steve Levitt, at least by