The Political Origins and Economic Consequences of Early U.S. Antitrust Law

Abstract

This dissertation examines the origins, implementation, and economic effects of early U.S. antitrust policy. The first chapter estimates the long-term effects of state antitrust laws on manufacturing outcomes. Using difference-in-differences and event study models that account for the staggered nature of adoption, I find that these statutes did little to limit the influence of powerful incumbents. The number of manufacturing establishments rose by about 10 percent following adoption, but this growth was likely driven by the expansion of incumbent firms rather than new entry. Employment and profits remained largely unchanged, while the labor share fell by 4 percent, suggesting that dominant firms held on to their market power despite new legal constraints on anticompetitive conduct. The second chapter revisits the origins of antitrust by investigating why some states adopted statutes before the Sherman Act of 1890. I leverage large-scale digitized newspaper data and machine learning methods to measure antimonopoly sentiment during the 1880s and connect these patterns to states’ statutory choices. Newspaper coverage points largely toward a broad, popular concern with monopoly rather than a coordinated agrarian or small-business campaign. Regression results similarly show that newspaper attention to monopoly—rather than measures of agricultural, small-business, or monopoly-sector strength—best predicts early adoption. Together, these results lend support to the “public interest” interpretation of antitrust’s origins. The third chapter turns to federal antitrust enforcement between 1890 and 1951. Using hand-collected data on Department of Justice antitrust cases, we estimate how federal enforcement actions affected manufacturing industries and workers. Together, the chapters illuminate the historical development and economic consequences of antitrust policy in the United States.