Posted by Social Science Research Network
Private Ordering in Chinese Antitrust
Angela Huyue Zhang (King’s College London)
Abstract: This Article begins with an inquiry into why there is a rarity of private challenges of decisions made by the Chinese antitrust authorities. The legal approach to the study of administrative law, which has received most academic attention, has not been able to provide a satisfactory answer to this question. To resolve this puzzle, this Article draws attention to the factors beyond the law, particularly the reputation sanction that Chinese antitrust agencies can strategically inflict on firms under their investigations. Based on event study methodology, I identified significant abnormal stock returns in response to an antitrust agency’s proactive public disclosure of its investigation. As the regulator has the discretion in deciding whether and when to disclose its investigation, this gives it significant clout in influencing the stock performance of firms subject to its investigation. In addition, I hand-collected data from 860 news articles on three high-profile antitrust cases and identified an editorial slant that can further inflate the reputation damage to these firms. A close review of these news articles reveals that such bias stems not only from supply but also demand factors. This Article contributes to several strands of research, particularly on the use of reputation sanction in regulation, the role of media in legal enforcement, and the limits of law in resolving administrative disputes in China.
Featured News
Lawmaker Probes FTC and EU’s Role in Amazon’s Failed iRobot Acquisition
May 2, 2024 by
CPI
FTC to Approve Exxon’s $64 Billion Deal with Pioneer Resources, Excludes
May 1, 2024 by
CPI
UK Competition Watchdog Raises Alarm Over Nvidia’s ARM Takeover
May 1, 2024 by
CPI
Sen. Klobuchar Urges Regulators to Probe Collusion in Healthcare Pricing
May 1, 2024 by
CPI
Multiple States Join Tennessee’s Antitrust Lawsuit Against NCAA Over NIL Rules
May 1, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI