How Economics Can Improve Antitrust Doctrine towards Tie-In Sales: Comment on Jean Tirole’s “The Analysis of Tying Cases”

Dennis Carlton, Michael Waldman, Apr 01, 2005

Tirole has written an excellent primer focused on what is known about tying and what he believes is desirable antitrust policy concerning the practice. Although the authors agree with most of Tirole’s arguments, there are two topics for which their perspective is somewhat different. First, he discusses situations in which tying can harm competition and reduce welfare. Second, in his policy discussion Tirole stops short in some places of using theory to provide concrete guidance and restraint to antitrust enforcers. In other places his suggestions could lead to less rather than more clarity. The authors explain their reasons for preferring more limited role for antitrust intervention than Tirole appears to recommend.