Neither Populist nor Neoclassical: The Classical Roots of the Competition Principle in American Antitrust Law

Contemporary critics of American antitrust law lament a supposed misinterpretation by modern, welfare-driven enforcers of the true meaning of the competition principle. This essay contributes to the debate by reconstructing the principle's historical origin. While it did not feature in the Sherman Act, the competition principle was introduced by the Supreme Court during the early years of antitrust law. The court formulated alternative versions of the principle; the one that eventually prevailed was neither populist nor neoclassical, as it was based on classical political economy and, in particular, on freedom of contract and “natural” values. This historical circumstance may pave the way for a new approach to antitrust law.