Sherman Antitrust Act
The Sherman Antitrust Act (Sherman Act) is a landmark federal statute in the history of United States antitrust law (or "competition law") passed by Congress in 1890. It prohibits certain business activities that federal government regulators deem to be anti-competitive, and requires the federal government to investigate and pursue trusts.
- For much too long a time, students of the history of the American antitrust policy have been at least mildly perplexed by the coolness with which American economists greeted the Sherman Act. Was not the nineteenth century the period in which the benevolent effects of competition were most widely extolled? Should not a profession praise a Congress which seeks to legislate its textbook assumptions into universal practice? And with even modest foresight, should not the economists have seen that the Sherman Act would put more into economists' purses than perhaps any other law ever passed?
Of course there were partial explanations The coolness of the economists sometimes rested more on disbelief in the efficacy of the Sherman Act than on hostility to its purpose. The route of regulation was preferred-although this preference hardly restores the reputations of those economists as prophets. One might even point out that there were not many good American economists at the time, although an undeniable giant such as Irving Fisher shared the common view.
- George J. Stigler, "The Economists and the Problem of Monopoly", The American Economic Review, Vol. 72, No. 2, Papers and Proceedings of the Ninety-Fourth Annual Meeting of the American Economic Association (May, 1982)
- The overall effect of the antitrust laws, then, is to maintain the status quo within the market—to not let anyone get ahead of his competition through normal competitive practices. In fact, the breadth of the antitrust laws is so extensive that it is now technically illegal to even be engaged in business in the United States!
- Quote from The Fundamentals of Liberty by Robert LeFevre, Santa Ana: CA, Rampart Institute, 1988, p. 207.