In two new research papers, Ryan Brutger and Amy Pond explore how different messaging about the effects of antitrust enforcement sways American public opinion toward and away from stronger enforcement.
Markets around the world, and especially in the United States, are increasingly concentrated. Concentration is generally bad for consumers, as it limits competition and can elevate prices. It can, in the form of monopsony power, with fewer employers in the area, reduce the share of profits that workers earn. Concentration is also problematic from a political standpoint: Large companies have more political influence, and they can plausibly use this influence to reduce corporate taxation and regulation and further erode competition. Antitrust policy is the main tool that policymakers have to reduce concentration and increase competition.To overcome large firms’ capture of democratic processes and regulation and reduce their economic harms, antitrust policy and its democratic license must be strengthened to take on market concentration. However, it’s not always clear, as ProMarket’s recent symposium on democracy and antitrust discusses, how voters think about antitrust policy. We thus explore the conditions when citizens demand action to limit concentration and strengthen antitrust. In two recently published papers, we question when citizens support stronger action on antitrust, finding that Americans are concerned with how antitrust affects the competitiveness of U.S. firms in global markets and that Americans are also influenced by arguments about moral fairness and antitrust.
Measuring public support for antitrust
We ran two public opinion survey experiments in the U.S. during the summer of 2020. The surveys allowed us to assess baseline levels of support for antitrust across the U.S. population, to examine which arguments are most influential when it comes to shifting American support for antitrust, and to gauge how the results align with traditional political party lines. The surveys used experiments that randomly assigned respondents to read short messages containing information about antitrust. We drew this information from real-world arguments about economics, fairness, democratic representation, regulatory overreach, and international competitiveness that are frequently used by politicians and the media. By providing respondents with different types of information, we could assess which types of messaging were most effective in moving public opinion both to support and to oppose more stringent antitrust law.
Among those respondents in our control group who simply read what antitrust is, we found that a majority, about 59 percent, were supportive of strengthening antitrust. Perhaps surprisingly, we did not find that economic arguments move public opinion on antitrust. When Americans read that antitrust law reduces prices, increases efficiency, or allows small companies to participate in the market, they did not become more supportive of antitrust. This could be because Americans don’t find these to be compelling arguments, or it could be because they already know about these effects of antitrust, so the information had no additional effect on their opinion.
We found that other factors shape support for antitrust in meaningful ways.
We know from existing research that concerns about fairness are a significant factor shaping citizen preferences across economic and social issues. Our study finds that fairness also plays an important role in shaping antitrust attitudes. When respondents were informed that stronger antitrust enforcement can make it more likely that “those who work hardest succeed” or that stronger antitrust enforcement makes it more likely that “everyone has an equal chance to succeed,” they became more supportive of stronger enforcement. Those who read messaging about fairness were about five percentage points more likely to support stronger antitrust enforcement. Furthermore, information about fairness has similar effects across members of different political parties and with different ideological preferences.
Messaging about the democratic effects of antitrust also affected public opinion. Particularly, one treatment group read that antitrust is “important for the maintenance of democratic institutions, as it reduces the chance that large domestic companies control government policy.” We found large partisan differences in responses to this statement. Respondents who identify as Democrats became much more supportive of stronger antitrust enforcement, while reading the statement had basically no effect on Republican respondents. These results suggest that Democrats are more worried about the political power of big businesses to shape policy and are more likely to support stronger antitrust laws when informed that antitrust can curb the political influence of large companies.
Respondents were also responsive to information on regulatory overreach. Antitrust could impose higher operating costs on targeted firm owners, especially those who have been most successful in the past. Some respondents read that antitrust might “punish companies that are successful, since successful companies tend to grow fastest.” On average, this information reduced the likelihood that respondents would express support for stronger antitrust enforcement by about nine percentage points (and thus they become more likely to oppose stronger antitrust enforcement). We also found that these effects were about twice as large for respondents that identify as Republican than for Democratic respondents. The results are consistent with Republicans being traditionally more skeptical of government regulation.
Regulatory overreach might be especially concerning if it places domestic firms at a disadvantage relative to foreign firms, who may operate in a more lenient legal environment. Another group of respondents read that antitrust could “reduce American competitiveness by limiting the size of American companies, putting them at a disadvantage relative to foreign companies.” These respondents became about 10 percentage points less likely to support strengthening antitrust, making this one of the most influential arguments that respondents read. The magnitude of this effect suggests that a significant portion of the American population is concerned with how American firms can compete in international markets and the risk of antitrust policy placing American firms at a disadvantage—an argument that corporate leaders have frequently used.
Lastly, vocal critics of antitrust have long argued that antitrust is executed in a biased way, harming foreign firms more than domestic firms. We also sought to assess whether Americans would become more or less supportive of stronger antitrust enforcement if they read that it is “frequently enforced against foreign firms.” We found that, on average, enforcement against foreign firms made respondents more likely to support strengthening antitrust. Similar to the effects of messaging about how stronger antitrust enforcement disadvantages American firms, learning that antitrust is often enforced against foreign firms made respondents about 10 percentage points more likely to support strengthening antitrust. This effect is particularly important given that U.S. antitrust enforcement does frequently have an international scope, with numerous firms based in other countries having landed in the crosshairs of the Federal Trade Commission.
Key takeaways
These findings suggest that Americans are concerned about international competitiveness, but they are not sure how antitrust fits into this concern. On the one hand, if they learn that antitrust can harm the competitiveness of domestic firms, they are much less likely to support stronger antitrust policies. On the other hand, if they learn that antitrust laws are frequently used against foreign firms, they become much more supportive of stronger antitrust policies.
Taken together, our research shows that Americans generally support strengthening antitrust, but they are also persuaded by a broad range of arguments for, and against, stronger antitrust policy. Many Americans find fairness and the equal ability of companies to succeed compelling, but they are also concerned about how antitrust policies affect American firms’ ability to compete on the global stage. Furthermore, there are partisan divides between what principles influence support for antitrust. Democrats are more concerned about the influence of big businesses in politics, while Republicans are more concerned about punishing big companies for their past successes. These findings suggest that although support for antitrust is widespread, there are big differences in motivations for that support, which will become relevant as politicians debate not just whether but also how to implement antitrust.
Author Disclosure: The author reports no conflicts of interest. You can read our disclosure policy here.
Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.
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