Advances in computers and telecommunications and the development of the Internet have been applied to develop new transaction technologies that lower transaction costs. By lowering transaction costs, these changes in transaction technology make possible transaction innovation, that is, the...

The European Court of First Instance, through its decision in <i>Microsoft v. Commission</i>, dealt a one-two punch to incentives to innovate. First, by penalizing Microsoft for bundling its Media Player with Windows, the court will make companies reluctant to add innovative features to their products....