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The main problem is that current antitrust law doesn't clearly prohibit anti-competitive behavior like this. Modern antitrust law has largely been created by ju

The main problem is that current antitrust law doesn't clearly prohibit anti-competitive behavior like this. Modern antitrust law has largely been created by judges (often without any economic training) interpreting early 20th century laws. This is a great summary of how regulations could be adapted to stop this sort of activity: https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.pdf https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p... In short, competition needs to be increased (i.e. more platforms). For example, Amazon wouldn't be able to pull so many shenanigans if users could export all shopping data to jet.com and easily shop on multiple platforms. The other solution is updated regulations that follow in the footsteps of historical frameworks of antitrust in industries like utilities where it's accepted that monopolies are efficient, but strict measures are put in place to limit abusing market power.

373uehedhd 6y ago
There's nothing stopping an increase in competition is the problem. Sellers want the visibility of Amazon's platform with the benefits of rolling their own. There's nothing physically preventing a merchant alliance from forming its own platform, merchants (that aren't Walmart) simply don't do this because they know they're still getting more value by being on Amazon instead. Online retail isn't new or novel at this point, merchants have had all the time in the world to figure out a more favorable system.
- bingdig 6y ago
  Theoretical competition =/= actual competition. Yes, that could technically happen, but Amazon's market power makes it extremely difficult. Here, there's a two-sided marketplace (consumers and sellers) where Amazon has both sides. It's not enough for one side of the market to decide they want out. For example, see what merchants have done with Shopify and the Shop app (merchants are all on board, but consumers don't care).
  - 373uehedhd 6y ago
    What you're describing is the competitive advantage of shoppers preferring Amazon though, at least from how I'm reading your post. If a seller alliance or rival omnicorp can't entice consumers then they need either better marketing or better deals, competing in short. If they can't succeed at either of those in a manner significant enough to challenge Amazon then how is targeting Amazon with legislation actually helping consumers? It seems like most policy proposals boil down to making Amazon less competitive rather than cultivating an environment that results in more platforms capable of reaching Amazon's combination of scale and popularity. If Google was worse at Search there'd be more competition in the space but it'd hardly be a win for consumers unless you change the definition of a win.
    - bingdig 6y ago
      Yup, that's exactly what the linked article describes, but you have to take into account barriers to entry. Consumers prefer short term, lower prices on Amazon, others are pushed out, Amazon raises prices in the long run (already seeing this in prices and other ways - like higher search results) and strong network effects make barriers to entry too high for firms to re-enter.
koheripbal 6y ago
I don't believe the bottleneck here is the law or judicial interpretations. The problem (IMO) is that there is no political pressure for the Justice Department to seek corrective action against these near-monopolies. The lack of action (IMO) comes from two motivations... 1. The desire for US politicians to see US companies attain global near-monopoly status as a mechanism to help propagate US policy & surveillance. 2. The campaign finance influence these corporations buy through lobbying in Congress and their local/state officials. 1 & 2 aren't even all that independent. Amazon didn't setup HQ2 in DC for nothing. Bezos even literally bought the largest mansion in DC explicitly to host congressional networking events. The solution is simple, in principle. Nurture, fund, and support alternatives to these companies. Realistically, globalization means there is little hope for regulatory breakups in America's future.
- bingdig 6y ago
  Sure, there could be some corruption going on, but theres a much more mundane legal reason the DOJ won't bring cases. They often won't prosecute because the costs of losing anti-trust cases are so high, largely because of the way antitrust law is written. When the DOJ brings a case and loses, the agency loses all future power to bring a similar case because precedent is binding, so they only prosecute the most obvious anti-trust violations. As all these conflicting comments in this thread and related articles suggest - an antitrust case against Amazon is quite complex and not your straightforward monopoly or price fixing case.

373uehedhd 6y ago

There's nothing stopping an increase in competition is the problem. Sellers want the visibility of Amazon's platform with the benefits of rolling their own. There's nothing physically preventing a merchant alliance from forming its own platform, merchants (that aren't Walmart) simply don't do this because they know they're still getting more value by being on Amazon instead. Online retail isn't new or novel at this point, merchants have had all the time in the world to figure out a more favorable system.

bingdig 6y ago
Theoretical competition =/= actual competition. Yes, that could technically happen, but Amazon's market power makes it extremely difficult. Here, there's a two-sided marketplace (consumers and sellers) where Amazon has both sides. It's not enough for one side of the market to decide they want out. For example, see what merchants have done with Shopify and the Shop app (merchants are all on board, but consumers don't care).
- 373uehedhd 6y ago
  What you're describing is the competitive advantage of shoppers preferring Amazon though, at least from how I'm reading your post. If a seller alliance or rival omnicorp can't entice consumers then they need either better marketing or better deals, competing in short. If they can't succeed at either of those in a manner significant enough to challenge Amazon then how is targeting Amazon with legislation actually helping consumers? It seems like most policy proposals boil down to making Amazon less competitive rather than cultivating an environment that results in more platforms capable of reaching Amazon's combination of scale and popularity. If Google was worse at Search there'd be more competition in the space but it'd hardly be a win for consumers unless you change the definition of a win.
  - bingdig 6y ago
    Yup, that's exactly what the linked article describes, but you have to take into account barriers to entry. Consumers prefer short term, lower prices on Amazon, others are pushed out, Amazon raises prices in the long run (already seeing this in prices and other ways - like higher search results) and strong network effects make barriers to entry too high for firms to re-enter.

koheripbal 6y ago

I don't believe the bottleneck here is the law or judicial interpretations. The problem (IMO) is that there is no political pressure for the Justice Department to seek corrective action against these near-monopolies. The lack of action (IMO) comes from two motivations... 1. The desire for US politicians to see US companies attain global near-monopoly status as a mechanism to help propagate US policy & surveillance. 2. The campaign finance influence these corporations buy through lobbying in Congress and their local/state officials. 1 & 2 aren't even all that independent. Amazon didn't setup HQ2 in DC for nothing. Bezos even literally bought the largest mansion in DC explicitly to host congressional networking events. The solution is simple, in principle. Nurture, fund, and support alternatives to these companies. Realistically, globalization means there is little hope for regulatory breakups in America's future.

bingdig 6y ago
Sure, there could be some corruption going on, but theres a much more mundane legal reason the DOJ won't bring cases. They often won't prosecute because the costs of losing anti-trust cases are so high, largely because of the way antitrust law is written. When the DOJ brings a case and loses, the agency loses all future power to bring a similar case because precedent is binding, so they only prosecute the most obvious anti-trust violations. As all these conflicting comments in this thread and related articles suggest - an antitrust case against Amazon is quite complex and not your straightforward monopoly or price fixing case.