Behavioral antitrust: not ready for the main stage

Antitrust law is firmly grounded in rational choice theory. The behavioral antitrustliterature introduces irrationality into the analysis of the reasons and effects of firms'behavior. Behavioral scholars claim that several antitrust issues may be better understoodby taking account of heuristics and cognitive biases in the firms' decision makingprocess. Generally, by arguing that welfare losses may be caused by irrational behaviorof firms the behavioral antitrust literature tends towards more interventionism. Thispaper questions the view that irrationality of firms would be a better assumption forexplaining and predicting market behavior. Moreover, the usefulness of a behavioralapproach is restricted by the ambiguous results of the theoretical analysis. Rather thanadopting an anti-Chicago profile, behavioral scholars should explore potential synergieswith the mainstream Post-Chicago literature. Information economics, the theoryof the firm and game theory have created scope for bounded rationality and informationproblems in the analysis of firms and markets. Behavioral antitrust may enrich butnot replace mainstream antitrust economics. In the current state of things, behavioralantitrust does certainly not require a change of the competition rules or antitrust methodology.Behavioral antitrust is a side act and not (yet) ready for the main stage.