About 'disadvantages of historical cost accounting'|... the dog's disadvantages: too much to defend, too small...] to a veritable plague of fleas through a long...both in the field—where it costs the enemy a daily fortune...
Ｎｏｔｅ: Ｒｅａｄ ｔｈｅ ｐｒｉｏｒ ｉｎｓｔａｌｌｍｅｎｔｓ ｏｆ ｔｈｉｓ ｅｓｓａｙ ｓｅｒｉｅｓ ｈｅｒｅ: Ｐａｒｔ Ｉ; Ｐａｒｔ ＩＩ; Ｐａｒｔ ＩＩＩ; Ｐａｒｔ ＩＶ. Ｉｎ Ｃｈａｐｔｅｒｓ 3 ａｎｄ 4 ｏｆ Ａｎｔｉｔｒｕｓｔ: Ｔｈｅ Ｃａｓｅ ｆｏｒ Ｒｅｐｅａｌ, Ｄｏｍｉｎｉｃｋ Ｔ. Ａｒｍｅｎｔａｎｏ ａｒｇｕｅｓ ａｇａｉｎｓｔ ｔｈｅ ｐｒｉｍａｒｙ ｒｅａｓｏｎｓ ｆｒｅｑｕｅｎｔｌｙ ｇｉｖｅｎ ｆｏｒ ｔｈｅ ｅｘｉｓｔｅｎｃｅ ｏｆ ａｎｔｉｔｒｕｓｔ ｌａｗｓ. Ｈｅ ｃｒｉｔｉｃｉｚｅｓ ｔｈｅ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｍｏｄｅｌ, ｔｈｅ Ｎｅｏｃｌａｓｓｉｃａｌ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ ｍｏｄｅｌ, ａｎｄ ｔｈｅ ｉｄｅａ ｔｈａｔ ｆｒｅｅ-ｍａｒｋｅｔ ｂａｒｒｉｅｒｓ ｔｏ ｅｎｔｒｙ ｐｏｓｅ ｐｒｏｂｌｅｍｓ ｆｏｒ ｃｏｎｓｕｍｅｒｓ. Ｐｒｏｂｌｅｍｓ ｗｉｔｈ Ｐｅｒｆｅｃｔ Ｃｏｍｐｅｔｉｔｉｏｎ Ａｃｃｏｒｄｉｎｇ ｔｏ Ａｒｍｅｎｔａｎｏ, "ｉｔ ｉｓ ｄｉｆｆｉｃｕｌｔ ｔｏ ｕｎｄｅｒｓｔａｎｄ ｔｈｅ ｒｅｌｅｖａｎｃｅ [ｏｆ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｔｈｅｏｒｙ] ｉｎ ａ ｒｅａｌ ｗｏｒｌｄ ｏｆ ｄｉｆｆｅｒｅｎｔｉａｔｅｄ ｐｒｅｆｅｒｅｎｃｅｓ, ｅｃｏｎｏｍｉｃ ｕｎｃｅｒｔａｉｎｔｙ, ａｎｄ ｄｙｎａｍｉｃ ｃｈａｎｇｅ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 33). Ｔｈｅ ｒｅａｌ ｅｃｏｎｏｍｉｃ ｐｒｏｂｌｅｍ - ｔｈｅ ｐｒｏｂｌｅｍ ｃｏｍｐｅｔｉｔｉｏｎ ｍｕｓｔ ｓｏｌｖｅ - ｉｓ ｎｏｔ ｈｏｗ ｔｏ ａｌｌｏｃａｔｅ ｒｅｓｏｕｒｃｅｓ ｇｉｖｅｎ ｐｅｒｆｅｃｔ ｉｎｆｏｒｍａｔｉｏｎ, ｂｕｔ ｒａｔｈｅｒ ｏｎｅ ｏｆ "ｕｎｄｅｒｓｔａｎｄｉｎｇ ｈｏｗ ｔｈｅ ｃｏｍｐｅｔｉｔｉｖｅ ｍａｒｋｅｔ ｐｒｏｃｅｓｓ ｏｆ ｄｉｓｃｏｖｅｒｙ ａｎｄ ａｄｊｕｓｔｍｅｎｔ ｗｏｒｋｓ ｔｏ ｃｏｏｒｄｉｎａｔｅ ａｎｔｉｃｉｐａｔｅｄ ｄｅｍａｎｄ ｗｉｔｈ ｓｕｐｐｌｙ ｉｎ ａ ｗｏｒｌｄ ｏｆ ｉｍｐｅｒｆｅｃｔ ｉｎｆｏｒｍａｔｉｏｎ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 33). Ｔｈｅ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｍｏｄｅｌ ａｓｓｕｍｅｓ ａｗａｙ ｔｈｉｓ ｂａｓｉｃ ｐｒｏｂｌｅｍ ａｎｄ ｉｓ ｔｈｕｓ ｉｒｒｅｌｅｖａｎｔ ｔｏ ｔｈｅ ｒｅａｌ ｗｏｒｌｄ. Ａｒｍｅｎｔａｎｏ ｃｏｎｔｉｎｕｅｓ ｂｙ ｎｏｔｉｎｇ ｔｈａｔ ｔｈｅ ｕｎｃｅｒｔａｉｎｔｙ ｏｆ ｒｅａｌ ｍａｒｋｅｔｓ ｏｆｔｅｎ ｎｅｃｅｓｓｉｔａｔｅｓ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ, ａｄｖｅｒｔｉｓｉｎｇ, ａｎｄ ｉｎｔｅｒｆｉｒｍ ｃｏｏｒｄｉｎａｔｉｏｎ -- ｎｏｎｅ ｏｆ ｗｈｉｃｈ ａｒｅ ｉｎｄｉｃａｔｏｒｓ ｔｈａｔ ｃｏｍｐｅｔｉｔｉｏｎ ｉｓ ｂｅｉｎｇ ｓｔｉｆｌｅｄ; ｔｈｅｙ ｓｉｍｐｌｙ ｉｎｄｉｃａｔｅ ｄｉｓｅｑｕｉｌｉｂｒｉｕｍ. Ｕｎｆｏｒｔｕｎａｔｅｌｙ, ｍｏｓｔ ｏｆ ａｎｔｉｔｒｕｓｔ ｅｎｆｏｒｃｅｍｅｎｔ ｈａｓ ｂｅｅｎ ｇｒｏｕｎｄｅｄ ｉｎ ｔｈｅ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｍｏｄｅｌ - ｔｈｅｒｅｂｙ ｐｒｅｓｕｍｉｎｇ ｔｈａｔ ｏｕｔｐｕｔｓ ｌｅｓｓ ｔｈａｎ ｔｈｅ ｔｈｅｏｒｅｔｉｃａｌ "ｐｅｒｆｅｃｔｌｙ ｃｏｍｐｅｔｉｔｉｖｅ ｏｕｔｐｕｔ" ａｒｅ ｓｏｍｅｈｏｗ "ｒｅｓｔｒｉｃｔｅｄ." Ｎｅｉｔｈｅｒ ｔｈｉｓ ｎｏｒ ａｎｔｉｔｒｕｓｔ ａｕｔｈｏｒｉｔｉｅｓ' ｓｕｓｐｉｃｉｏｎ ｏｆ ａｄｖｅｒｔｉｓｉｎｇ ａｎｄ ｉｎｔｅｒｆｉｒｍ ｃｏｏｒｄｉｎａｔｉｏｎ ａｒｅ ｗａｒｒａｎｔｅｄ ｉｆ ｔｈｅ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｍｏｄｅｌ ｉｔｓｅｌｆ ｉｓ ｆｌａｗｅｄ. Ａｓ ａｎ ａｌｔｅｒｎａｔｉｖｅ ｔｏ ｔｈｅ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｍｏｄｅｌ, Ａｒｍｅｎｔａｎｏ ｐｒｏｐｏｓｅｓ ｔｈｅ Ｈａｙｅｋｉａｎ ｖｉｅｗ ｏｆ ｃｏｍｐｅｔｉｔｉｏｎ "ａｓ ａｎ ｅｎｔｒｅｐｒｅｎｅｕｒｉａｌ ｐｒｏｃｅｓｓ ｏｆ ｄｉｓｃｏｖｅｒｙ ａｎｄ ａｄｊｕｓｔｍｅｎｔ ｕｎｄｅｒ ｃｏｎｄｉｔｉｏｎｓ ｏｆ ｕｎｃｅｒｔａｉｎｔｙ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 34). Ｔｈｉｓ ｉｍｐｌｉｅｓ ｔｈａｔ ｎｏ ａ ｐｒｉｏｒｉ ｗａｙ ｅｘｉｓｔｓ ｔｏ ｄｅｔｅｒｍｉｎｅ ｗｈｅｔｈｅｒ ｏｒ ｔｏ ｗｈａｔ ｅｘｔｅｎｔ ｒｉｖａｌｒｙ ｏｒ ｃｏｏｐｅｒａｔｉｏｎ ａｒｅ ａｐｐｒｏｐｒｉａｔｅ ｉｎ ａｎｙ ｐａｒｔｉｃｕｌａｒ ｍａｒｋｅｔ. Ｆｕｒｔｈｅｒｍｏｒｅ, ｉｎ ｔｈｅ ｃｏｕｒｓｅ ｏｆ ｔｈｅ ｍａｒｋｅｔ ｐｕｒｐｏｓｅ, ｓｏｍｅ ｆｉｒｍｓ ｍａｙ ｇａｉｎ ｔｒｅｍｅｎｄｏｕｓｌｙ ｉｎ ｍａｒｋｅｔ ｓｈａｒｅ, ｗｈｅｒｅａｓ ｏｔｈｅｒｓ ｍａｙ ｆａｉｌ ａｎｄ ｓｕｆｆｅｒ ｌａｒｇｅ ｌｏｓｓｅｓ. Ｂｏｔｈ ｐｈｅｎｏｍｅｎａ ａｒｅ ｎｅｃｅｓｓａｒｙ ｆｏｒ ｔｈｅ ｄｉｓｃｏｖｅｒｙ ｐｒｏｃｅｓｓ ｏｆ ｔｈｅ ｍａｒｋｅｔ ｔｏ ｔａｋｅ ｐｌａｃｅ. Ｐｒｏｂｌｅｍｓ ｗｉｔｈ Ｆｒｅｅ-Ｍａｒｋｅｔ Ｍｏｎｏｐｏｌｙ Ｔｈｅｏｒｙ Ａｒｍｅｎｔａｎｏ ｉｓ ｆｕｒｔｈｅｒｍｏｒｅ ｓｋｅｐｔｉｃａｌ ｏｆ ｔｈｅ "ａｃｔｕａｌ ａｂｉｌｉｔｙ ｏｆ ａ ｍｏｎｏｐｏｌｙ ｆｉｒｍ, ｏｒ ａ ｇｒｏｕｐ ｏｆ ｃｏｌｌｕｄｉｎｇ ｆｉｒｍｓ, ｔｏ ｒｅｓｔｒｉｃｔ ｔｈｅ ｍａｒｋｅｔ ｓｕｐｐｌｙ ａｎｄ ｒｅａｌｉｚｅ ｍｏｎｏｐｏｌｙ ｐｒｉｃｅｓ ａｎｄ ｐｒｏｆｉｔｓ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 35). Ｔｈｅ Ｎｅｏｃｌａｓｓｉｃａｌ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ ｍｏｄｅｌ ｓｔａｒｔｓ ｂｙ ａｓｓｕｍｉｎｇ ｔｈａｔ ａ ｆｒｅｅ-ｍａｒｋｅｔ ｓｏｌｅ ｐｒｏｄｕｃｅｒ ｒｅｓｔｒｉｃｔｓ ｏｕｔｐｕｔ ａｎｄ ｔｈｅｎ ｃｏｍｐａｒｅｓ ｓｕｃｈ ａ ｒｅｓｔｒｉｃｔｅｄ ｏｕｔｐｕｔ ｗｉｔｈ ｏｕｔｐｕｔ ｕｎｄｅｒ ｉｄｅａｌ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ ｃｏｎｄｉｔｉｏｎｓ. Ｈｏｗｅｖｅｒ, Ａｒｍｅｎｔａｎｏ ｒｅｃｏｇｎｉｚｅｓ ｔｈａｔ "ｔｈｅ ａｔｏｍｉｓｔｉｃ ｅｑｕｉｌｉｂｒｉｕｍ ｏｕｔｐｕｔ ｌｅｖｅｌ [ｕｎｄｅｒ ｐｅｒｆｅｃｔ ｃｏｍｐｅｔｉｔｉｏｎ] ｉｓ ｎｅｉｔｈｅｒ ｐｏｓｓｉｂｌｅ ｎｏｒ ｒｅｌｅｖａｎｔ ａｎｄ ｃａｎｎｏｔ ｓｅｒｖｅ ａｓ ｔｈｅ ｗｅｌｆａｒｅ ｂｅｎｃｈｍａｒｋ ｆｏｒ ａｎｙ ｃｏｍｐａｒｉｓｏｎ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 36). Ｆｕｒｔｈｅｒｍｏｒｅ, ｔｈｅ ｆｒｅｅ ｍａｒｋｅｔ ｗｉｌｌ ｒｅｎｄｅｒ ａｎｙ ｍｏｎｏｐｏｌｉｓｔ'ｓ ｏｒ ｃａｒｔｅｌ'ｓ ａｔｔｅｍｐｔｓ ｔｏ ｒｅｓｔｒｉｃｔ ｍａｒｋｅｔ ｏｕｔｐｕｔ ａｎｄ ａｒｔｉｆｉｃｉａｌｌｙ ｒａｉｓｅ ｐｒｉｃｅｓ ｅｘｔｒｅｍｅｌｙ ｓｈｏｒｔ-ｌｉｖｅｄ, ａｓ ｗｈｅｎ ｔｈｅ ｍｏｎｏｐｏｌｉｓｔ ｒａｉｓｅｓ ｐｒｉｃｅｓ ａｂｏｖｅ ｍａｒｇｉｎａｌ ａｎｄ ａｖｅｒａｇｅ ｃｏｓｔｓ, "ｓｔｒｏｎｇ ｅｃｏｎｏｍｉｃ ｉｎｃｅｎｔｉｖｅｓ ｔｈｅｎ ｅｘｉｓｔ ｔｏ ｅｘｐａｎｄ ｃｕｒｒｅｎｔ ｐｒｏｄｕｃｔｉｏｎ ａｎｄ ｔｏ ｅｎｃｏｕｒａｇｅ ｏｕｔｐｕｔ ｂｙ ｎｅｗ ｆｉｒｍｓ," ｌｅａｄｉｎｇ ｐｒｉｃｅｓ ｔｏ ｆａｌｌ ａｎｄ ｍｏｒｅ ｃｌｏｓｅｌｙ ａｐｐｒｏｘｉｍａｔｅ ｃｏｓｔｓ (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 36). Ｉｆ ａ ｍｏｎｏｐｏｌｉｓｔ ｔｒｉｅｓ ｔｏ ｄｒａｍａｔｉｃａｌｌｙ ｌｏｗｅｒ ｉｔｓ ｐｒｉｃｅｓ ｉｎ ｏｒｄｅｒ ｔｏ ｄｅｔｅｒ ｅｎｔｒｙ ｂｙ ｒｉｖａｌｓ, ｔｈｉｓ ｗｉｌｌ ｉｎｃｒｅａｓｅ ｓａｌｅｓ ａｎｄ ｔｈｕｓ ｌｅａｄ ｔｈｅ ｍａｒｋｅｔ ｔｏｗａｒｄ ａ ｃｏｍｐｅｔｉｔｉｖｅ ｌｅｖｅｌ ｏｆ ｏｕｔｐｕｔ. Ｉｆ ｔｈｅ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｉｓｔ ｅｎｇａｇｅｓ ｉｎ ｐｒｉｃｅ ｄｉｓｃｒｉｍｉｎａｔｉｏｎ, ｔｈｅ ｏｕｔｐｕｔ ｗｉｌｌ ｌｉｋｅｗｉｓｅ ｉｎｃｒｅａｓｅ, ａｎｄ ｔｈｅ ａｄｄｉｔｉｏｎａｌ ｕｎｉｔｓ ｏｆ ｏｕｔｐｕｔ ｗｉｌｌ ｂｅ ｓｏｌｄ ａｔ ｌｏｗｅｒ ｐｒｉｃｅｓ. Ｍｏｒｅｏｖｅｒ, ａｎ ｉｎｅｆｆｉｃｉｅｎｔ ｍｏｎｏｐｏｌｉｓｔ ｂｙ ｈｉｓ ｖｅｒｙ ｉｎｅｆｆｉｃｉｅｎｃｙ ｉｎｖｉｔｅｓ ｎｅｗ ｅｎｔｒｙ ａｎｄ ｃａｎｎｏｔ ｄｅｔｅｒ ｉｔ - ｗｈｉｌｅ ａ ｍｏｒｅ ｅｆｆｉｃｉｅｎｔ ｍｏｎｏｐｏｌｉｓｔ ｃａｎ ｏｎｌｙ ｄｅｔｅｒ ｒｉｖａｌｓ ａｓ ａ ｒｅｓｕｌｔ ｏｆ ｈｉｓ ｅｆｆｉｃｉｅｎｃｙ, ｉｎ ｗｈｉｃｈ ｃａｓｅ ｔｈｅｒｅ ｅｘｉｓｔｓ ｎｏ ｄｉｍｉｎｕｔｉｏｎ ｏｆ ｃｏｎｓｕｍｅｒ ｗｅｌｌ-ｂｅｉｎｇ. Ａ ｃａｒｔｅｌ ｅｎｃｏｕｎｔｅｒｓ ａｄｄｉｔｉｏｎａｌ ｄｉｆｆｉｃｕｌｔｉｅｓ - ａｓ ｗｅｌｌ ａｓ ａｌｌ ｔｈｅ ｏｎｅｓ ｍｅｎｔｉｏｎｅｄ ａｂｏｖｅ. Ｉｔ ｍｕｓｔ ａｌｓｏ ｅｆｆｅｃｔｉｖｅｌｙ ｐｏｌｉｃｅ ａｎｄ ｃｏｏｒｄｉｎａｔｅ ｉｔｓ ａｔｔｅｍｐｔｓ ｔｏ ｒｅｓｔｒｉｃｔ ｏｕｔｐｕｔ ａｎｄ ｒａｉｓｅ ｐｒｉｃｅ. Ｉｎ ｓｈｏｒｔ, "ｔｈｅｒｅ ｉｓ ｌｉｔｔｌｅ ｒｅｌｉａｂｌｅ ｅｖｉｄｅｎｃｅ ｔｈａｔ ｆｒｅｅ-ｍａｒｋｅｔ ｃｏｌｌｕｓｉｏｎ ｃａｎ ａｌｌｏｗ ｃｏｎｓｐｉｒｉｎｇ ｆｉｒｍｓ ｔｏ ｃａｐｔｕｒｅ ｍｏｎｏｐｏｌｙ ｐｒｏｆｉｔｓ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 37). Ａｒｍｅｎｔａｎｏ ｃｏｎｓｉｄｅｒｓ ｔｈｅ Ｎｅｏｃｌａｓｓｉｃａｌ ｓｔａｎｄａｒｄ ｏｆ "ａｌｌｏｃａｔｉｖｅ ｅｆｆｉｃｉｅｎｃｙ" ｔｏ ｂｅ "ｃｏｎｔｒｉｖｅｄ ａｎｄ ｍｉｓｌｅａｄｉｎｇ" - ａｓ ｉｔ ｎｅｇｌｅｃｔｓ ｔｈｅ ｐｏｓｓｉｂｉｌｉｔｙ ｔｈａｔ "ａ ｃｏｍｐｅｔｉｔｉｖｅ ｐｒｏｃｅｓｓ ａｌｗａｙｓ ｏｐｅｒａｔｅｓ ｕｎｄｅｒ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ" ａｎｄ "ｎｏ ｆｉｎａｌ ａｔｏｍｉｓｔｉｃ ｅｑｕｉｌｉｂｒｉｕｍ ｃｏｎｄｉｔｉｏｎ ｃａｎ ｅｖｅｒ ｅｘｉｓｔ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 38). Ｉｆ ｔｈｅｓｅ ａｒｅ ｔａｋｅｎ ｉｎｔｏ ａｃｃｏｕｎｔ, ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｉｅｓ ｃｅａｓｅ ｔｏ ｂｅ ａ ｐｒｏｂｌｅｍ. Ｔｈｅ Ｎｅｏｃｌａｓｓｉｃａｌ ａｓｓｕｍｐｔｉｏｎ ｒｅｇａｒｄｉｎｇ "ｔｅｃｈｎｉｃａｌ ｉｎｅｆｆｉｃｉｅｎｃｙ" ｉｎ ａ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ ｓｉｔｕａｔｉｏｎ ｉｓ ｓｉｍｉｌａｒｌｙ ｆｌａｗｅｄ - ａｓ ｉｎ "ａｎｙ ｓｅｒｉｏｕｓ ａｔｔｅｍｐｔ ｔｏ ｍｏｎｏｐｏｌｉｚｅ ｓｏｍｅ ｆｒｅｅ ｍａｒｋｅｔ, ｂｕｓｉｎｅｓｓ ａｒｅ ｆａｒ ｍｏｒｅ ｌｉｋｅｌｙ ｔｏ ｌｏｗｅｒ ｃｏｓｔｓ ｔｈａｎ ｔｈｅｙ ａｒｅ ｔｏ ｒａｉｓｅ ｔｈｅｍ, ａｎｄ ｔｏ ｅｘｐａｎｄ ｒａｔｈｅｒ ｔｈａｎ ｄｅｃｒｅａｓｅ ｐｒｏｄｕｃｔｉｏｎ. Ｔｈｅ ｍｏｓｔ ｅｆｆｅｃｔｉｖｅ ｗａｙ ｔｏ ｇａｉｎ ａｎｄ ｈｏｌｄ ａ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ ｐｏｓｉｔｉｏｎ ｉｓ ｔｏ ｂｅ ｍｏｒｅ ｅｆｆｉｃｉｅｎｔ ｔｈａｎ ｒｉｖａｌｓ ｏｒ ｐｏｔｅｎｔｉａｌ ｒｉｖａｌｓ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 38). Ｆｕｒｔｈｅｒｍｏｒｅ, Ａｒｍｅｎｔａｎｏ ｂｅｌｉｅｖｅｓ ｉｔ ｉｓ ｉｌｌｅｇｉｔｉｍａｔｅ ｔｏ ｃｏｎｓｉｄｅｒ ｔｈｅ ｃｏｓｔｓ ｏｆ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ａｓ ｉｎｃｒｅａｓｅｄ ｃｏｓｔｓ ｕｎｄｅｒ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ, ｓｉｎｃｅ ｄｉｆｆｅｒｅｎｔｉａｔｅｄ ｐｒｏｄｕｃｔｓ ａｒｅ ｆｕｎｄａｍｅｎｔａｌｌｙ ｄｉｆｆｅｒｅｎｔ ｆｒｏｍ ｈｏｍｏｇｅｎｅｏｕｓ ｐｒｏｄｕｃｔｓ ａｎｄ ｔｈｕｓ ｃａｎｎｏｔ ｂｅ ｃｏｍｐａｒｅｄ ｔｏ ｔｈｅｍ. Ｔｈｅ Ｓｔａｎｄａｒｄ Ｏｉｌ Ｃａｓｅ Ｔｈｅ ｆａｃｔｓ ｓｕｒｒｏｕｎｄｉｎｇ ｔｈｅ 1911 Ｓｔａｎｄａｒｄ Ｏｉｌ Ｃａｓｅ ａｒｅ ｆｒｅｑｕｅｎｔｌｙ ｍｉｓｕｎｄｅｒｓｔｏｏｄ. Ｓｔａｎｄａｒｄ Ｏｉｌ ｎｅｖｅｒ ａｃｔｅｄ ｔｏ ｔｈｅ ｄｅｔｒｉｍｅｎｔ ｏｆ ｃｏｎｓｕｍｅｒｓ; ｑｕｉｔｅ ｔｈｅ ｃｏｎｔｒａｒｙ, ｉｔｓ ｔｒｅｍｅｎｄｏｕｓ ｅｆｆｉｃｉｅｎｃｙ ｂｒｏｕｇｈｔ ａｂｏｕｔ ｉｔｓ ｆａｓｔ ｇｒｏｗｔｈ ａｎｄ ａｂｉｌｉｔｙ ｔｏ ｇａｉｎ ａ ｌａｒｇｅ ｍａｒｋｅｔ ｓｈａｒｅ ｉｎ ｏｉｌ. Ｓｔａｎｄａｒｄ Ｏｉｌ'ｓ ａｃｔｉｖｉｔｉｅｓ ｌｅｄ ｔｏ ｔｒｅｍｅｎｄｏｕｓ ｄｒｏｐｓ ｉｎ ｃｏｎｓｕｍｅｒ ｐｒｉｃｅｓ; Ａｒｍｅｎｔａｎｏ ｎｏｔｅｓ ｔｈａｔ "ｐｒｉｃｅｓ ｆｏｒ ｋｅｒｏｓｅｎｅ ｆｅｌｌ ｆｒｏｍ 30 ｃｅｎｔｓ ａ ｇａｌｌｏｎ ｉｎ 1869 ｔｏ 9 ｃｅｎｔｓ ｉｎ 1880, 7.4 ｃｅｎｔｓ ｉｎ 1890, ａｎｄ 5.9 ｃｅｎｔｓ ｉｎ 1897" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 41). Ｔｈｅ ｍａｒｋｅｔ ｃｏｎｔｉｎｕａｌｌｙ ｒｅｍａｉｎｅｄ ｏｐｅｎ ｔｏ ｃｏｍｐｅｔｉｔｏｒｓ, ａｎｄ Ｓｔａｎｄａｒｄ Ｏｉｌ'ｓ ｍａｒｋｅｔ ｓｈａｒｅ ａｃｔｕａｌｌｙ ｆｅｌｌ ｆｒｏｍ 85% ｉｎ 1890 ｔｏ 64% ｉｎ 1911 - ｂｙ ｗｈｉｃｈ ｔｉｍｅ Ｓｔａｎｄａｒｄ Ｏｉｌ ｈａｄ ｏｖｅｒ 147 ｃｏｍｐｅｔｉｔｏｒｓ. Ｆｕｒｔｈｅｒｍｏｒｅ, ｔｈｅ ｃｏｕｒｔｓ ｎｅｖｅｒ ｆｏｕｎｄ Ｓｔａｎｄａｒｄ Ｏｉｌ ｇｕｉｌｔｙ ｏｆ ｅｉｔｈｅｒ ｒｅｓｔｒｉｃｔｉｎｇ ｏｕｔｐｕｔ ｏｒ ｒａｉｓｉｎｇ ｐｒｉｃｅｓ. Ｒａｔｈｅｒ, ｔｈｅｙ ｓｉｍｐｌｙ ｒｕｌｅｄ ｔｈａｔ Ｓｔａｎｄａｒｄ Ｏｉｌ'ｓ ｈｏｌｄｉｎｇ ｃｏｍｐａｎｙ, Ｓｔａｎｄａｒｄ Ｏｉｌ ｏｆ Ｎｅｗ Ｊｅｒｓｅｙ ｗａｓ "ａ ｃｏｎｔｒａｃｔ ｏｒ ｃｏｍｂｉｎａｔｉｏｎ ｉｎ ｒｅｓｔｒａｉｎｔ ｏｆ ｔｒａｄｅ" ａｎｄ ｔｈｕｓ ｏｕｔｌａｗｅｄ ｂｙ ｔｈｅ Ｓｈｅｒｍａｎ Ａｃｔ; ｔｈｅｒｅｆｏｒｅ, ｔｈｅ ｃｏｕｒｔｓ ｒｕｌｅｄ ｔｏ ｄｉｓｓｏｌｖｅ ｔｈｅ ｃｏｍｐａｎｙ. Ａｌｔｈｏｕｇｈ ｔｈｅ ｃｏｕｒｔ ｏｓｔｅｎｓｉｂｌｙ ａｐｐｌｉｅｄ ｔｈｅ ｒｕｌｅ ｏｆ ｒｅａｓｏｎ ｔｏ ｔｈｉｓ ｃａｓｅ, "ｉｔ ｉｓ ｅｍｐｈａｔｉｃａｌｌｙ ｎｏｔ ｔｒｕｅ ｔｈａｔ ｔｈｅ Ｈｉｇｈ Ｃｏｕｒｔ ｐｒｅｓｅｎｔｅｄ ａｎｙ ｓｐｅｃｉｆｉｃ ｆｉｎｄｉｎｇ ｏｆ ｇｕｉｌｔ ｗｉｔｈ ｒｅｓｐｅｃｔ ｔｏ ｔｈｅ ｃｈａｒｇｅｓ ｏｆ ｍｉｓｃｏｎｄｕｃｔ ａｎｄ ｍｏｎｏｐｏｌｉｓｔｉｃ ｐｅｒｆｏｒｍａｎｃｅ ｂｒｏｕｇｈｔ ａｇａｉｎｓｔ [Ｓｔａｎｄａｒｄ Ｏｉｌ] ｂｙ ｔｈｅ ｇｏｖｅｒｎｍｅｎｔ... Ａｌｌ ｔｈａｔ ｔｈｅ Ｓｕｐｒｅｍｅ Ｃｏｕｒｔ ｄｉｄ - ｃｏｎｔｒａｒｙ ｔｏ ｏｖｅｒｗｈｅｌｍｉｎｇ ｃｏｎｖｅｎｔｉｏｎａｌ ｗｉｓｄｏｍ - ｗａｓ ｃｏｎｃｌｕｄｅ ｔｈａｔ ｓｏｍｅ ｏｆ Ｓｔａｎｄａｒｄ'ｓ ｐｒａｃｔｉｃｅｓ, ｓｕｃｈ ａｓ ｍｅｒｇｅｒ, ｅｖｉｄｅｎｃｅｄ ａｎ ｕｎｍｉｓｔａｋａｂｌｅ ｉｎｔｅｎｔ ｔｏ ｍｏｎｏｐｏｌｉｚｅ ａｎｄ ｔｈａｔ ｔｈｅｓｅ ｐｒａｃｔｉｃｅｓ ｗｅｒｅ ｕｎｒｅａｓｏｎａｂｌｅ. Ｗｈｙ ｗｅｒｅ ｔｈｅｙ ｕｎｒｅａｓｏｎａｂｌｅ? Ｂｅｃａｕｓｅ ｔｈｅ ｃｏｕｒｔ ｓａｉｄ ｔｈａｔ ｉｔ ｗａｓ ｏｂｖｉｏｕｓ ｔｈａｔ ｔｈｅｙ ｗｅｒｅ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 42-43). Ｃｌｅａｒｌｙ, ｔｈｉｓ ｄｅｆｉｎｉｎｇ ｃａｓｅ ｉｎ ｔｈｅ ｈｉｓｔｏｒｙ ｏｆ ａｎｔｉｔｒｕｓｔ ｌａｗ ｗａｓ ｂａｓｅｄ ｏｎ ｄｕｂｉｏｕｓ ｒｅａｓｏｎｉｎｇ ａｔ ｂｅｓｔ. Ｃｒｉｔｉｑｕｅ ｏｆ Ｅｍｐｉｒｉｃａｌ Ｓｔｕｄｉｅｓ Ａｒｍｅｎｔａｎｏ ｇｏｅｓ ｏｎ ｔｏ ｃｒｉｔｉｃｉｚｅ ｅｍｐｉｒｉｃａｌ ｓｔｕｄｉｅｓ ｔｈａｔ ａｓｓｕｍｅ ｔｈａｔ ｍａｒｋｅｔ ｃｏｎｃｅｎｔｒａｔｉｏｎ, ｐｒｏｆｉｔａｂｉｌｉｔｙ, ａｎｄ ｅｖｅｎ ａｄｖｅｒｔｉｓｉｎｇ ａｎｄ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ａｒｅ ｍｅａｓｕｒｅｓ ｏｆ ｍｏｎｏｐｏｌｙ ｐｏｗｅｒ ａｎｄ ｔｈｕｓ ｒｅｓｔｒｉｃｔｉｏｎｓ ｏｆ ｃｏｍｐｅｔｉｔｉｏｎ. Ｔｈｅｒｅ ａｒｅ ｓｅｖｅｒｅ ｍｅｔｈｏｄｏｌｏｇｉｃａｌ ｐｒｏｂｌｅｍｓ ｗｉｔｈ ｓｕｃｈ ｓｔｕｄｉｅｓ. Ｆｉｒｓｔ, ｔｈｅｓｅ ｓｔｕｄｉｅｓ ｍｅａｓｕｒｅ ａｃｃｏｕｎｔｉｎｇ ｐｒｏｆｉｔ, ｎｏｔ ｅｃｏｎｏｍｉｃ ｐｒｏｆｉｔ, ｗｈｉｃｈ ｍａｙ ｌｅａｄ ｔｏ ｆｌａｗｅｄ ｃｏｎｃｌｕｓｉｏｎｓ. "Ｓｅｃｏｎｄ, ｌｅｇａｌ ｍｏｎｏｐｏｌｙ ａｎｄ ｆｒｅｅ-ｍａｒｋｅｔ ｍｏｎｏｐｏｌｙ ｍｉｇｈｔ ｗｅｌｌ ｂｅ ｉｎｅｘｏｒａｂｌｙ ｉｎｔｅｒｔｗｉｎｅｄ ｉｎ ｔｈｅ ａｃｔｕａｌ ｂｕｓｉｎｅｓｓ ｗｏｒｌｄ; ｔａｒｉｆｆｓ, ｑｕｏｔａｓ, ｌｉｃｅｎｓｉｎｇ, ａｎｄ ｏｔｈｅｒ ｌｅｇａｌ ｒｅｓｔｒｉｃｔｉｏｎｓ ａｌｗａｙｓ ｔｅｎｄ ｔｏ ｇｅｎｅｒａｔｅ ｅｃｏｎｏｍｉｃ ｒｅｎｔｓ ｉｎ ｍａｒｋｅｔｓ ｔｈａｔ ａｒｅ ｏｔｈｅｒｗｉｓｅ ｏｐｅｎｌｙ ｃｏｍｐｅｔｉｔｉｖｅ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 44). Ｆｉｎａｌｌｙ, ｔｈｅｓｅ ｓｔｕｄｉｅｓ ａｒｅ ｆｌａｗｅｄ ｉｎ ｕｓｉｎｇ ｔｈｅ ｈｙｐｏｔｈｅｔｉｃａｌ "ｐｅｒｆｅｃｔｌｙ ｃｏｍｐｅｔｉｔｉｖｅ" ｏｕｔｐｕｔ ａｓ ａ ｂｅｎｃｈｍａｒｋ ｔｏ ｗｈｉｃｈ ｔｏ ｃｏｍｐａｒｅ ｒｅａｌ-ｗｏｒｌｄ ｓｉｔｕａｔｉｏｎｓ. Ｌｅｇａｌ Ｍｏｎｏｐｏｌｙ Ａｒｍｅｎｔａｎｏ ａｃｋｎｏｗｌｅｄｇｅｓ ｔｈａｔ ｌｅｇａｌ ｍｏｎｏｐｏｌｉｅｓ, ｅｓｔａｂｌｉｓｈｅｄ ｖｉａ ｇｏｖｅｒｎｍｅｎｔ ａｉｄ, ｃａｎ ａｎｄ ｄｏ ｈａｒｍ ｃｏｎｓｕｍｅｒｓ. Ｌｅｇａｌ ｍｏｎｏｐｏｌｉｅｓ ｃａｎ ｂｅ ｂｒｏｕｇｈｔ ａｂｏｕｔ ｂｙ ｌｉｃｅｎｓｉｎｇ, ｑｕｏｔａｓ, ｌｅｇａｌ ｆｒａｎｃｈｉｓｅｓ, ｃｅｒｔｉｆｉｃａｔｅｓ ｏｆ ｐｕｂｌｉｃ ｃｏｎｖｅｎｉｅｎｃｅ, ａｎｄ ｏｔｈｅｒ ｍｅａｎｓ. Ｖｏｌｕｎｔａｒｙ ｅｘｃｈａｎｇｅｓ ａｒｅ ｔｈｅｒｅｂｙ ｐｒｅｖｅｎｔｅｄ ａｎｄ "ｔｈｅ ｃｏｍｐｅｔｉｔｉｖｅ ｍａｒｋｅｔ ｐｒｏｃｅｓｓ ｈａｓ ｂｅｅｎ ｕｎｄｅｒｃｕｔ ａｎｄ ａｒｔｉｆｉｃｉａｌｌｙ ｓｈｏｒｔｃｉｒｃｕｉｔｅｄ - ｂｙ ｌａｗ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 45). Ｔｈｉｓ ｗｉｌｌ ｏｆｔｅｎ ｒｅｄｕｃｅ ｏｕｔｐｕｔ ａｎｄ ｒａｉｓｅ ｐｒｉｃｅｓ; ｅｆｆｉｃｉｅｎｔ ｐｒｏｄｕｃｅｒｓ ｗｉｌｌ ｏｆｔｅｎ ｂｅ ｅｘｃｌｕｄｅｄ ｔｏ ｔｈｅ ｂｅｎｅｆｉｔ ｏｆ ｔｈｏｓｅ ｗｈｏ ａｒｅ ｂｅｓｔ ａｔ ｓｅｅｋｉｎｇ ｇｏｖｅｒｎｍｅｎｔ ｆａｖｏｒｓ. Ｔｏ ａｄｄ ｔｏ ｔｈｅ ｐｒｏｂｌｅｍ, ｎｏ ｅｃｏｎｏｍｉｃ ｉｎｃｅｎｔｉｖｅｓ ｅｘｉｓｔ ｔｏ ｒｅｍｅｄｙ ｔｈｅ ｌｅｇａｌｌｙ-ｉｎｄｕｃｅｄ ｒｅｄｕｃｔｉｏｎ ｏｆ ｏｕｔｐｕｔ. Ｉｎ ｔｈｅ ｍｅａｎｔｉｍｅ, ｆｉｒｍｓ ｗｉｌｌ ｃｏｎｔｉｎｕａｌｌｙ ｗａｓｔｅ ｒｅｓｏｕｒｃｅｓ ｌｏｂｂｙｉｎｇ ｆｏｒ ｇｏｖｅｒｎｍｅｎｔ ｆａｖｏｒｓ. Ｔｈｅ ｏｎｌｙ ｌｅｇｉｔｉｍａｔｅ ｕｓｅ ｏｆ ａｎｔｉｔｒｕｓｔ ｌａｗｓ, ａｃｃｏｒｄｉｎｇ ｔｏ Ａｒｍｅｎｔａｎｏ, ｉｓ "ｔｏ ｒｅｍｏｖｅ ｌｅｇａｌ ｒｅｓｔｒｉｃｔｉｏｎｓ ｏｎ ｃｏｍｐｅｔｉｔｉｏｎ ａｎｄ ｃｏｏｐｅｒａｔｉｏｎ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 46). Ｂｕｔ ｅｖｅｎ ｈｅｒｅ ｉｔ ｉｓ ｎｅｃｅｓｓａｒｙ ｔｏ ｐｒｏｃｅｅｄ ｗｉｔｈ ｃａｕｔｉｏｎ ｓｏ ａｓ ｔｏ ａｖｏｉｄ ｐｒｏｓｅｃｕｔｉｎｇ ｆｒｅｅ-ｍａｒｋｅｔ ｃｏｏｐｅｒａｔｉｖｅ ａｇｒｅｅｍｅｎｔｓ ａｍｏｎｇ ｓｕｐｐｌｉｅｒｓ ａｎｄ ｔｏ ｐｒｅｖｅｎｔ ｔｈｅ ｈｏｒｒｅｎｄｏｕｓ ｄａｍａｇｅ ｂｒｏｕｇｈｔ ａｂｏｕｔ ｂｙ ｐｒｉｖａｔｅ ａｎｔｉｔｒｕｓｔ ｌａｗｓｕｉｔｓ. Ｆｒｅｅ-Ｍａｒｋｅｔ Ｂａｒｒｉｅｒｓ ｔｏ Ｅｎｔｒｙ? Ａｒｍｅｎｔａｎｏ ｄｅｖｏｔｅｓ Ｃｈａｐｔｅｒ 4 ｏｆ Ａｎｔｉｔｒｕｓｔ ｔｏ ａｄｄｒｅｓｓｉｎｇ ａｌｌｅｇｅｄ ｆｒｅｅ-ｍａｒｋｅｔ ｂａｒｒｉｅｒｓ ｔｏ ｅｎｔｒｙ ｓｕｃｈ ａｓ ａｄｖｅｒｔｉｓｉｎｇ ａｎｄ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ. Ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ｃａｎ ｏｎｌｙ ｏｃｃｕｒ ｉｎ ａ ｍａｒｋｅｔ ｉｆ ｃｏｎｓｕｍｅｒｓ ｈａｖｅ ｅｘｐｒｅｓｓｅｄ ａ ｐｒｅｆｅｒｅｎｃｅ ｆｏｒ ｉｔ ａｎｄ ａ ｗｉｌｌｉｎｇｎｅｓｓ ｔｏ ｂｅａｒ ｉｔｓ ｃｏｓｔｓ. Ｉｆ ｎｅｗ ｐｒｏｄｕｃｅｒｓ ｆｉｎｄ ｉｔ ｄｉｆｆｉｃｕｌｔ ｔｏ ｅｎｔｅｒ ａ ｍａｒｋｅｔ ｆｕｌｌ ｏｆ ｄｉｆｆｅｒｅｎｔｉａｔｅｄ ｐｒｏｄｕｃｔｓ, ｔｈｅｎ ｔｈｉｓ ｉｓ ｄｕｅ ｔｏ ｔｈｅ ｎａｔｕｒｅ ｏｆ ｃｏｎｓｕｍｅｒ ｐｒｅｆｅｒｅｎｃｅｓ, ｎｏｔ ｔｏ ａｎｙ "ｕｎｆａｉｒ ａｄｖａｎｔａｇｅｓ" ｐｏｓｓｅｓｓｅｄ ｂｙ ｉｎｃｕｍｂｅｎｔ ｆｉｒｍｓ. Ａｓ ｅｆｆｉｃｉｅｎｔ ｒｅｓｏｕｒｃｅ ａｌｌｏｃａｔｉｏｎ ｒｅｑｕｉｒｅｓ ｔｈａｔ ｒｅｓｏｕｒｃｅｓ ｂｅ ｐｕｔ ｔｏ ｔｈｅ ｕｓｅｓ ｍｏｓｔ ｖａｌｕｅｄ ｂｙ ｃｏｎｓｕｍｅｒｓ, ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ｉｓ ｎｏ ｇｒｏｕｎｄｓ ｆｏｒ ａｎｔｉｔｒｕｓｔ ｐｒｏｓｅｃｕｔｉｏｎ. Ｆｕｒｔｈｅｒｍｏｒｅ, ａｎｙｏｎｅ ｉｓ ｓｔｉｌｌ ｆｒｅｅ ｔｏ ｅｎｔｅｒ ａ ｄｉｆｆｅｒｅｎｔｉａｔｅｄ ｍａｒｋｅｔ ａｎｄ ｔｏ ａｔｔｅｍｐｔ ｔｏ ｃｏｎｖｉｎｃｅ ｃｏｎｓｕｍｅｒｓ ｔｏ ｓｕｐｐｏｒｔ ｌｅｓｓ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ｏｒ ｔｏ ｆｉｎｄ ｃｈｅａｐｅｒ ｍｅｔｈｏｄｓ ｏｆ ｐｒｏｄｕｃｔｉｏｎ. Ｆｕｒｔｈｅｒｍｏｒｅ, Ａｒｍｅｎｔａｎｏ ｒｅｊｅｃｔｓ ｔｈｅ ｃｒｉｔｉｑｕｅ ｏｆ ｓｏｍｅ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ ａｓ ｆｒｉｖｏｌｏｕｓ ａｎｄ ｕｎｎｅｃｅｓｓａｒｙ ｂｙ ｎｏｔｉｎｇ ｔｈａｔ ｔｈｅ ｒｅｖｅａｌｅｄ ｐｒｅｆｅｒｅｎｃｅｓ ｏｆ ｃｏｎｓｕｍｅｒｓ ａｒｅ ｗｈａｔ ｍｕｓｔ ｕｌｔｉｍａｔｅｌｙ ｄｅｃｉｄｅ ｂｅｔｗｅｅｎ ｎｅｃｅｓｓａｒｙ ａｎｄ ｓｕｐｅｒｆｌｕｏｕｓ ｐｒｏｄｕｃｔ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ. Ｉｆ ｃｏｎｓｕｍｅｒｓ "ａｒｅ ｗｉｌｌｉｎｇ ｔｏ ｐａｙ ｓｕｂｓｔａｎｔｉａｌｌｙ ｍｏｒｅ ｆｏｒ ｓｏｍｅ ｄｉｆｆｅｒｅｎｔｉａｔｉｏｎ, ｔｈｅｎ ｉｔ ｉｓ ｄｅｍｏｎｓｔｒａｂｌｙ ｎｏｔ ｆｒｉｖｏｌｏｕｓ ａｎｄ ｔｈｅ ｒｅｓｏｕｒｃｅｓ ｉｔ ｕｓｅｓ ａｒｅ ｎｏｔ ｍｉｓａｌｌｏｃａｔｅｄ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 54). Ｉｔ ｉｓ ｐｏｓｓｉｂｌｅ ｆｏｒ ｆｉｒｍｓ ｔｏ ｗａｓｔｅ ｒｅｓｏｕｒｃｅｓ ｉｎ ｔｒｙｉｎｇ ｔｏ ｆｉｇｕｒｅ ｏｕｔ ｅｘａｃｔｌｙ ｗｈａｔ ｃｏｎｓｕｍｅｒｓ ｐｒｅｆｅｒ - ｂｕｔ ｔｈｉｓ ｉｓ ｂｅｃａｕｓｅ ｆｉｒｍｓ ｍｕｓｔ ａｎｔｉｃｉｐａｔｅ ｃｏｎｓｕｍｅｒｓ' ｐｒｅｆｅｒｅｎｃｅｓ ｂｅｆｏｒｅ ｔｈｏｓｅ ｐｒｅｆｅｒｅｎｃｅｓ ａｒｅ ｅｘｐｌｉｃｉｔｌｙ ｒｅｖｅａｌｅｄ, ｔｈｕｓ ｌｅａｄｉｎｇ ｔｏ ａ ｐｏｔｅｎｔｉａｌ ｆｏｒ ｅｒｒｏｒ ａｎｄ ｍｉｓｃａｌｃｕｌａｔｉｏｎ. Ｓｕｃｈ ｍｉｓｔａｋｅｓ ａｒｅ ｉｎｅｖｉｔａｂｌｅ, ｅｖｅｎ ｇｉｖｅｎ ｓｔｒｏｎｇ ｆｒｅｅ-ｍａｒｋｅｔ ｉｎｃｅｎｔｉｖｅｓ ｎｏｔ ｔｏ ｍａｋｅ ｔｈｅｍ. Ｎｏｔｈｉｎｇ ｉｎ ａｎｔｉｔｒｕｓｔ ｌａｗ ｃａｎ ｍａｋｅ ｔｈｅｓｅ ｍｉｓｔａｋｅｓ ａｎｙ ｌｅｓｓ ｆｒｅｑｕｅｎｔ. Ａｄｖｅｒｔｉｓｉｎｇ ｉｎ ａ ｆｒｅｅ ｍａｒｋｅｔ ｉｓ, ｌｉｋｅｗｉｓｅ, ｎｏｔ ａ ｐｒｏｂｌｅｍ. Ａｒｍｅｎｔａｎｏ ｎｏｔｅｓ ｔｈａｔ ｔｒｅａｔｉｎｇ ａｄｖｅｒｔｉｓｉｎｇ ａｓ ａ ｓｕｐｅｒｆｌｕｏｕｓ "ｓｅｌｌｉｎｇ ｅｘｐｅｎｓｅ" ａｐａｒｔ ｆｒｏｍ ｐｒｏｄｕｃｔｉｏｎ ｅｘｐｅｎｓｅｓ "ｉｓ ｔｏｔａｌｌｙ ａｒｂｉｔｒａｒｙ. Ａｌｌ ｂｕｓｉｎｅｓｓ ｃｏｓｔｓ ａｒｅ ｓｅｌｌｉｎｇ ｃｏｓｔｓ ｉｎ ｔｈｅ ｓｅｎｓｅ ｔｈａｔ ａｌｌ ｒｅｓｏｕｒｃｅｓ ａｒｅ ｅｘｐｅｎｄｅｄ ｗｉｔｈ ｔｈｅ ｐｕｒｐｏｓｅ ｏｆ ｓｅｌｌｉｎｇ ｐｒｏｄｕｃｔｓ ｔｏ ｃｏｎｓｕｍｅｒｓ ａｔ ａ ｐｒｏｆｉｔ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 58). Ａｄｖｅｒｔｉｓｉｎｇ ｗｏｕｌｄ ｉｎｄｅｅｄ ｂｅ ｕｎｎｅｃｅｓｓａｒｙ ｉｎ ａ "ｐｅｒｆｅｃｔｌｙ ｃｏｍｐｅｔｉｔｉｖｅ" ｍａｒｋｅｔ ｗｉｔｈ ｐｅｒｆｅｃｔ ｉｎｆｏｒｍａｔｉｏｎ, ｂｕｔ ｔｈｉｓ ｉｓ ｎｏｔ ａ ｒｅａｌ-ｗｏｒｌｄ ｐｏｓｓｉｂｉｌｉｔｙ. Ａｒｍｅｎｔａｎｏ ｄｏｅｓ ｎｏｔ ｐｅｒｃｅｉｖｅ ａ ｐｒｏｂｌｅｍ ｗｉｔｈ ｆｉｒｍｓ ｗｈｏ ａｄｖｅｒｔｉｓｅ ｍｏｒｅ ｅｆｆｉｃｉｅｎｔｌｙ ｔｈａｎ ｏｔｈｅｒｓ; ｔｈｉｓ ｉｓ ｎｏｔ ａ ｍｉｓａｌｌｏｃａｔｉｏｎ ｏｆ ｒｅｓｏｕｒｃｅｓ. "Ｔｈｅ ｏｎｌｙ ｏｂｖｉｏｕｓ ｗａｓｔｅ ｈｅｒｅ ｉｓ ｏｎ ｔｈｅ ｐａｒｔ ｏｆ ｔｈｅ ｆｉｒｍｓ ｔｈａｔ ａｄｖｅｒｔｉｓｅ ｌｅｓｓ ｅｆｆｉｃｉｅｎｔｌｙ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 59). Ｆｕｒｔｈｅｒｍｏｒｅ, Ａｒｍｅｎｔａｎｏ ｓｅｅｓ ｎｏｔｈｉｎｇ ｐｒｏｂｌｅｍａｔｉｃ ｗｉｔｈ ｆｉｒｍｓ ｔｈａｔ ｔａｋｅ ａｄｖａｎｔａｇｅ ｏｆ ｌｏｗ-ｃｏｓｔ ｔｅｃｈｎｏｌｏｇｉｅｓ ａｎｄ ｅｃｏｎｏｍｉｅｓ ｏｆ ｓｃａｌｅ ｔｏ ｍａｉｎｔａｉｎ ｄｏｍｉｎａｎｔ ｐｏｓｉｔｉｏｎｓ ｉｎ ａ ｍａｒｋｅｔ. Ｓｕｃｈ ｄｏｍｉｎａｎｃｅ ｉｓ ｐｕｒｅｌｙ ｌｅｇｉｔｉｍａｔｅ, ａｓ ｉｔ ｉｓ ｄｕｅ ｔｏ ｅｆｆｉｃｉｅｎｔ ｆｉｒｍｓ' ａｂｉｌｉｔｙ ｔｏ ｍｏｒｅ ｒｅａｄｉｌｙ ｓａｔｉｓｆｙ ｃｏｎｓｕｍｅｒ ｐｒｅｆｅｒｅｎｃｅｓ. Ｔｈｅ ｖｅｒｙ ｐｏｉｎｔ ｏｆ ｔｈｅ ｍａｒｋｅｔ ｐｒｏｃｅｓｓ ｉｓ ｔｏ ｄｉｓｃｏｖｅｒ ｔｈｅ ｍｏｓｔ ｅｆｆｉｃｉｅｎｔ ｗａｙ ｔｏ ｅｎｈａｎｃｅ ｃｏｎｓｕｍｅｒ ｗｅｌｌ-ｂｅｉｎｇ; ｔｈｉｓ ｈａｓ ｎｏｔｈｉｎｇ ｔｏ ｄｏ ｗｉｔｈ ａ ｓｐｅｃｉｆｉｃ ｎｕｍｂｅｒ ｏｆ ｃｏｍｐｅｔｉｔｏｒｓ, ａｎｄ ｉｔ ｉｓ ｑｕｉｔｅ ｐｏｓｓｉｂｌｅ ｔｈａｔ ｏｎｅ ｆｉｒｍ ｏｒ ａ ｆｅｗ ｆｉｒｍｓ ｍｉｇｈｔ ｂｅ ｍｏｒｅ ｓｕｉｔｅｄ ｔｏ ｓｕｐｐｌｙｉｎｇ ｃｏｎｓｕｍｅｒ ｗａｎｔｓ ｉｎ ａ ｇｉｖｅｎ ｍａｒｋｅｔ ｔｈａｎ ａ ｍｕｌｔｉｔｕｄｅ ｏｆ ｆｉｒｍｓ. Ｎｏｒ ｉｓ ｓｏｍｅ ｆｉｒｍｓ' ｅａｓｉｅｒ ａｃｃｅｓｓ ｔｏ ｆｉｎａｎｃｉａｌ ｃａｐｉｔａｌ ａ ｂａｒｒｉｅｒ ｔｏ ｇｅｎｕｉｎｅ ｃｏｍｐｅｔｉｔｉｏｎ. Ａｒｍｅｎｔａｎｏ ｎｏｔｅｓ ｔｈａｔ "Ｆｉｎａｎｃｉａｌ ｃａｐｉｔａｌ, ｌｉｋｅ ａｌｌ ｒｅｓｏｕｒｃｅｓ, ｃａｎｎｏｔ ｂｅ ｆｒｅｅ ｔｏ ａｌｌ ｗｈｏ ｗｏｕｌｄ ｗａｎｔ ｔｏ ｕｓｅ ｉｔ, ａｎｄ ｉｔｓ ｃｏｓｔｓ ｍｕｓｔ ｂｅ ｂｏｒｎｅ ｂｙ ｔｈｏｓｅ ｗｈｏ ｉｎｔｅｎｄ ｔｏ ｕｓｅ ｉｔ ｐｒｏｄｕｃｔｉｖｅｌｙ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 63). Ｓｏｍｅ ｆｉｒｍｓ ｍａｙ ｂｅ ａｂｌｅ ｔｏ ａｃｑｕｉｒｅ ｃａｐｉｔａｌ ａｔ ｌｏｗｅｒ ｃｏｓｔｓ ｂｅｃａｕｓｅ ｔｈｅｙ ｈａｖｅ ｄｅｍｏｎｓｔｒａｔｅｄ ｔｈａｔ ｔｈｅｙ ａｒｅ ｌｏｗｅｒ ｒｉｓｋｓ ａｎｄ ｈａｖｅ ｂｅｅｎ ａｂｌｅ ｔｏ ｓｈｏｗ ｔｈｒｏｕｇｈ ｔｈｅｉｒ ｐａｓｔ ａｃｔｉｖｉｔｉｅｓ ｔｈａｔ ｔｈｅｙ ａｒｅ ａｂｌｅ ｔｏ ｕｓｅ ｃａｐｉｔａｌ ｓｕｃｃｅｓｓｆｕｌｌｙ. Ｉｎｓｏｆａｒ ａｓ ｃａｐｉｔａｌ ｃｏｓｔｓ ａｒｅ ａ ｂａｒｒｉｅｒ ｔｏ ｅｎｔｒｙ, ｔｈｅｙ ｅｎａｂｌｅ ｍｏｒｅ ｅｆｆｉｃｉｅｎｔ ｕｓｅｒｓ ｏｆ ｃａｐｉｔａｌ ｔｏ ｅｘｃｌｕｄｅ ｌｅｓｓ ｅｆｆｉｃｉｅｎｔ ｏｎｅｓ - ｗｈｉｃｈ ｉｓ ｎｏｔ ａ ｐｒｏｂｌｅｍ ｆｏｒ ｃｏｎｓｕｍｅｒｓ. Ｆｕｒｔｈｅｒｍｏｒｅ, ｔｈｉｓ ｂａｒｒｉｅｒ ｉｓ ｒｏｕｔｉｎｅｌｙ ｏｖｅｒｃｏｍｅ, ａｓ ｔｈｏｕｓａｎｄｓ ｏｆ ｎｅｗ ｆｉｒｍｓ ｒｅｃｅｉｖｅ ａｃｃｅｓｓ ｔｏ ｃａｐｉｔａｌ; ｔｈｅ ｏｎｌｙ ｐｒｏｂｌｅｍａｔｉｃ ｂａｒｒｉｅｒｓ ｔｏ ｃａｐｉｔａｌ ａｒｅ ｔｈｏｓｅ ｅｒｅｃｔｅｄ ｂｙ ｔｈｅ ｌａｗ. Ｎｏｒ ｉｓ "ｐｒｅｄａｔｏｒｙ ｐｒｉｃｉｎｇ" ａ ｐｒｏｂｌｅｍ ｉｎ ａ ｆｒｅｅ ｍａｒｋｅｔ. Ａｒｍｅｎｔａｎｏ ｍｅｎｔｉｏｎｓ ｔｈｅ ｄｉｆｆｉｃｕｌｔｙ ｏｆ ｄｉｓｔｉｎｇｕｉｓｈｉｎｇ ｇｅｎｕｉｎｅｌｙ "ｐｒｅｄａｔｏｒｙ" ｐｒａｃｔｉｃｅｓ ｆｒｏｍ ｒｏｕｔｉｎｅ ｃｏｍｐｅｔｉｔｉｖｅ ｐｒｉｃｅ ｒｅｄｕｃｔｉｏｎｓ ａｎｄ ｐｒｏｄｕｃｔ ｉｎｎｏｖａｔｉｏｎｓ. Ｈｅ ａｓｋｓ: "ｗｈｉｃｈ ｃｏｓｔｓ ａｒｅ ｒｅｌｅｖａｎｔ ｆｏｒ ｓｕｃｈ ｄｅｔｅｒｍｉｎａｔｉｏｎｓ? Ａｖｅｒａｇｅ ｃｏｓｔｓ? Ｍａｒｇｉｎａｌ ｃｏｓｔｓ? Ｌｏｎｇ-ｒｕｎ ｍａｒｇｉｎａｌ ｃｏｓｔｓ? Ｗｈｙ ａｒｅ ｈｉｓｔｏｒｉｃａｌ ａｃｃｏｕｎｔｉｎｇ ｃｏｓｔｓ ｒｅｌｅｖａｎｔ ａｔ ａｌｌ?" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 65). Ｆｕｒｔｈｅｒｍｏｒｅ, "ｐｒｅｄａｔｏｒｙ ｐｒａｃｔｉｃｅｓ ｃａｎｎｏｔ ｓｕｃｃｅｅｄ ｗｉｔｈｏｕｔ ｄｉｒｅｃｔ ｃｏｎｓｕｍｅｒ-ｂｕｙｅｒ ｓｕｐｐｏｒｔ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 65). Ｉｆ ｂｕｙｅｒｓ ａｒｅ ｄｉｓｐｌｅａｓｅｄ ｂｙ ａ ｃｅｒｔａｉｎ ｆｉｒｍ'ｓ ｐｒｉｃｅ ｃｕｔｔｉｎｇ, ｔｈｅｙ ａｒｅ ａｌｗａｙｓ ｆｒｅｅ ｔｏ ｐａｔｒｏｎｉｚｅ ｔｈａｔ ｆｉｒｍ'ｓ ｃｏｍｐｅｔｉｔｏｒｓ. Ｔｈｅ ｆａｃｔ ｔｈａｔ ｔｈｉｓ ｄｏｅｓ ｎｏｔ ｈａｐｐｅｎ ｍｅａｎｓ ｔｈａｔ ｓｕｃｈ "ｐｒｅｄａｔｏｒｙ" ｐｒｉｃｅ ｒｅｄｕｃｔｉｏｎｓ ｄｏ ｎｏｔ ｈａｒｍ ｃｏｎｓｕｍｅｒｓ. Ｆｕｒｔｈｅｒｍｏｒｅ, ａｎｔｉｔｒｕｓｔ ｐｒｏｐｏｎｅｎｔｓ ｃａｎｎｏｔ ｌｅｇｉｔｉｍａｔｅｌｙ ｃｌａｉｍ ｔｏ ｋｎｏｗ ｔｈｅ ｌｏｎｇ-ｒｕｎ ｐｒｅｆｅｒｅｎｃｅｓ ｏｆ ｂｕｙｅｒｓ ｂｅｔｔｅｒ ｔｈａｎ ｔｈｅ ｂｕｙｅｒｓ ｄｏ ｔｈｅｍｓｅｌｖｅｓ - ａｎｄ ｍｏｒｅｏｖｅｒ, ｃｏｎｓｕｍｅｒｓ "ｃａｎ ｓｕｒｅｌｙ ｄｅｃｉｄｅ ｔｈｅｉｒ ｏｗｎ ｔｉｍｅ ｐｒｅｆｅｒｅｎｃｅｓ ａｎｄ ｔｈｅｎ ｄｅｃｉｄｅ ｗｈｅｔｈｅｒ ｔｈｅ ａｄｖａｎｔａｇｅｓ ｏｆ ｓｈｏｒｔ-ｒｕｎ ｐｒｉｃｅ ｒｅｄｕｃｔｉｏｎｓ ｅｘｃｅｅｄ ｔｈｅ ｐｏｓｓｉｂｌｅ ｄｉｓａｄｖａｎｔａｇｅｓ ｏｆ ｆｅｗｅｒ ｓｕｐｐｌｉｅｒｓ ｉｎ ｔｈｅ ｆｕｔｕｒｅ" (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 65). Ａｒｍｅｎｔａｎｏ ａｐｐｌｉｅｓ ｔｈｅ ｓａｍｅ ｌｏｇｉｃ ｔｏ ｓｏ-ｃａｌｌｅｄ ｎｏｎ-ｐｒｉｃｅ ｐｒｅｄａｔｏｒｙ ｐｒａｃｔｉｃｅｓ. Ｉｔ ｉｓ ｕｐ ｔｏ ｃｏｎｓｕｍｅｒｓ ｔｏ ｃｈｏｏｓｅ ｗｈｅｔｈｅｒ ａ ｎｅｗ ｐｒｏｄｕｃｔ ｉｎｎｏｖａｔｉｏｎ ｗｉｌｌ ｒｅｄｕｃｅ ｔｈｅ ｎｕｍｂｅｒ ｏｆ ｃｏｍｐｅｔｉｔｏｒｓ - ａｎｄ ｉｆ ｃｏｎｓｕｍｅｒｓ ｄｏ ｓｏ, ｔｈｉｓ ｉｓ ｎｏｔ ｐｒｏｂｌｅｍａｔｉｃ. Ａｒｍｅｎｔａｎｏ ｎｏｔｅｓ ｔｈａｔ "ｉｔ ｗｏｕｌｄ ｂｅ ｄｉｆｆｉｃｕｌｔ ｔｏ ｉｍａｇｉｎｅ ａｎ ａｎｔｉｔｒｕｓｔ ｉｎｔｅｒｖｅｎｔｉｏｎ ａｓ ｐｏｔｅｎｔｉａｌｌｙ ｄａｎｇｅｒｏｕｓ ｏｒ ｄａｍａｇｉｎｇ ｔｏ ｆｕｔｕｒｅ ｃｏｎｓｕｍｅｒ ｗｅｌｆａｒｅ ａｓ ｔｈｉｓ ｓｏｒｔ ｏｆ ｉｎｎｏｖａｔｉｏｎ ｒｅｇｕｌａｔｉｏｎ" ｗｈｉｃｈ ｗｏｕｌｄ ｂｌｏｃｋ ｔｈｅ ｉｎｔｒｏｄｕｃｔｉｏｎ ｏｆ ｎｅｗ ａｎｄ ｓｕｐｅｒｉｏｒ ｐｒｏｄｕｃｔｓ (Ａｒｍｅｎｔａｎｏ 1999, ｐ. 66). Ｍｏｒｅｏｖｅｒ, ｐｒｅｄａｔｏｒｙ ｐｒａｃｔｉｃｅｓ ｈａｖｅ ａ ｈｉｇｈ ｌｉｋｅｌｉｈｏｏｄ ｏｆ ｆａｉｌｕｒｅ ｆｏｒ ｔｈｅ ｆｉｒｍ ｗｈｏ ｕｎｄｅｒｔａｋｅｓ ｔｈｅｍ; ｔｈｅ ｆｉｎａｎｃｉａｌ ｒｉｓｋｓ ｏｆ ｐｒｅｄａｔｉｏｎ ａｒｅ ｔｈｅｍｓｅｌｖｅｓ ｔｒｅｍｅｎｄｏｕｓ ｄｉｓｉｎｃｅｎｔｉｖｅｓ ｆｒｏｍ ｅｎｇａｇｉｎｇ ｉｎ ｔｈｅ ｐｒａｃｔｉｃｅ, ａｎｄ ｈｉｓｔｏｒｙ ｈａｓ ｓｈｏｗｎ ｅｘｔｒｅｍｅｌｙ ｆｅｗ ｕｎａｍｂｉｇｕｏｕｓ ｉｎｓｔａｎｃｅｓ ｏｆ ｐｒｅｄａｔｏｒｙ ｂｅｈａｖｉｏｒ. |
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