Elgar original reference
Edited by Manfred Neumann and Jürgen Weigand
Competition is a constitutive element of a market economy. It follows from the right of each individual to pursue his or her own interest. Therefore competition policy – or antitrust, as it is being called in the US – is a cornerstone of economic policy in a market economy. In the history of ideas, competition policy as a salient feature of a free society can be traced back at least to John Locke (1690) who propounded that everybody has the unalienable right to pursue his or her own happiness. This idea found its way into the legislation of the US by the Sherman Act of 1890 which prohibits restraints of competition in most general terms. This legislation found hardly any support among economists. It was only with the 1930s that economic theory began to furnish theoretical support for competition policy. Since then quite a lot has been accomplished in this direction. Today, in the US antitrust has come to rely to a substantial degree on economic theory, and in the EC competition policy a ‘more economic approach’ has increasingly won ground. This Handbook is intended to provide a scholarly review of the state of the art regarding principles of economic theory, empirical evidence and standards of evaluation in a way accessible to a wider audience.