Oligopoly Pricing and Richard Posner

By Keith N. Hylton (Boston University)

Over a span of nearly 50 years Richard Posner’s voice has loomed large over the subject of oligopoly pricing and antitrust. The span begins in 1969 with Posner’s publication of “Oligopoly and the Antitrust Laws: A Suggested Approach,” which argues for more aggressive enforcement of Section 1 in cases involving circumstantial evidence of conspiracy. The span ends with Posner’s opinion in In re Text Messaging Antitrust Litigation, in 2015. The two writings, the first an academic article published early in Posner’s career and the second a judicial opinion published near the end of his time on the bench, suggest very different approaches to the enforcement of Section 1 in oligopoly pricing cases. In Part II, I describe the text messaging litigation and the reasoning behind Posner’s virtual volte-face on oligopoly pricing. In Part III, I discuss the beginning of Posner’s journey, and the basis for his comparatively idealistic vision of the scope of Section 1. Part III considers the path forward; what courts are likely to do on the question of the scope of Section 1, and what courts should do.

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