Hostname: page-component-7c8c6479df-p566r Total loading time: 0 Render date: 2024-03-29T08:32:32.482Z Has data issue: false hasContentIssue false

Prisms of Distance and Power: Viewing the U.S. Regulatory Tradition

Published online by Cambridge University Press:  20 January 2020

Abstract

Distorted images of American regulatory ideas and practices frame foreign responses to these practices as well as foreign views of the economic policies of the United States. U.S. power both embeds and contributes to these distorted images. This article highlights the evolution of these distortions and the ways in which business history has intertwined with legal and political history throughout the evolution. It focuses on a specific area of regulation—antitrust or competition law—in order to ground the more general discussion. The article provides insights into the relationship between cognitive distance and power and into its pernicious effects on transnational discussions and decisions involving competition law.

Type
Research Article
Copyright
Copyright © The President and Fellows of Harvard College 2020

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 See, for example, McCraw, Thomas K., “Rethinking the Trust Question,” in Regulation in Perspective: Historical Essays, ed. McCraw, Thomas K. (Cambridge, MA, 1981), 1Google Scholar.

2 See, for example, Bignami, Francesca, “Regulation and the Courts,” in Comparative Law and Regulation: Understanding the Global Regulatory Process, ed. Bignami, Francesca and Zaring, David (Cheltenham, U.K., 2016)CrossRefGoogle Scholar, 279n2.

3 For an extended discussion of this method, see Michaels, Ralf, “The Functional Method of Comparative Law,” in The Oxford Handbook of Comparative Law, ed. Reimann, Mathias and Zimmermann, Reinhard (Oxford, 2006), 339–82Google Scholar.

4 On Europe, see Giandomenica Majone, Regulating Europe (London, 1996), esp. xiii.

5 See, for instance, Reuel Schiller, “The Historical Origins of American Regulatory Exceptionalism,” in Bignami and Zaring, Comparative Law, 35.

6 On the contested term “regulation,” see, for example, Robert Baldwin, Martin Cave, and Martin Lodge, eds., introduction to Understanding Regulation: Theory, Strategy, and Practice (Oxford, 2012), 2.

7 Particularly important contributions include Daniel R. Ernst, Tocqueville's Nightmare: The Administrative State Emerges in America, 1900–1940 (Oxford, 2014); Stephen Skowronek, Building a New American State: The Expansion of National Administrative Capacities, 1877–1920 (Cambridge, U.K., 1982); and Howard Gillman, “How Political Parties Can Use the Courts to Advance Their Agendas, 1875–1891,” American Political Science Review 96, no. 3 (2002): 511–24.

8 See, for instance, Sujit Choudhry, “Globalization in Search of Justification: Toward a Theory of Comparative Constitutional Interpretation,” Indiana Law Journal 74, no. 3 (1999): 819–92.

9 See William J. Novak, The People's Welfare: Law and Regulation in Nineteenth-Century America, 3rd ed. (Chapel Hill, 1996), 235–48; and Charles Fried, Saying What the Law Is: The Constitution in the Supreme Court (Cambridge, MA, 2005), 70.

10 See, for example, Tom Ginsburg, “Comparative Administrative Procedure: Evidence from Northeast Asia,” Constitutional Political Economy 13, no. 3 (2002): 260–61.

11 See Sean Farhang, “Public Regulation and Private Lawsuits in the American Separation of Powers System,” American Journal of Political Science 52, no. 4 (2008): 821–39.

12 See Francesca Bignami, “Introduction: A New Field: Comparative Law and Regulation,” in Bignami and Zaring, Comparative Law, 1–51.

13 The concept was coined and developed in Robert Kagan, Adversarial Legalism (Cambridge, MA, 2003).

14 See Robert Kagan, “Adversarial Legalism and American Government,” Journal of Policy Analysis and Management 10, no. 3 (1991): 369-406.

15 On the legal realist movement, see William W. Fisher III, Morton J. Horwitz, and Thomas A. Reed, eds., American Legal Realism (Oxford, 1993); and Laura Kalman, Legal Realism at Yale, 1927–1960 (Chapel Hill, 1986).

16 For a comparative study that focuses on some of these issues, see Ronald J. Allen, Stefan Kock, Kurt Riechenberg, and Toby D. Rosen, “The German Advantage in Civil Procedure: A Plea for More Details and Fewer Generalities in Comparative Scholarship,” Northwestern University Law Review 82 (1987–1988): 705.

17 For a classic study, see Henry M. Hart and Albert M. Sacks, The Legal Process: Basic Problems in the Making and Application of the Law, ed. William N. Eskridge Jr. and Phillip P. Frickey (Minneapolis, 1994).

18 See, for example, Bignami, “Regulation and the Courts,” 63, and Baldwin, Cave, and Lodge, introduction to Understanding Regulation. For France, see Susan Rose-Ackerman and Thomas Perroud, “Policymaking and Public Law in France: Public Participation, Agency Independence, and Impact Assessment,” Columbia Journal of European Law 19, no. 2 (2013): 225–312.

19 See Walter A. Stoffel, “Enlightened Decision Making,” Tulane Law Review 75 (2001): 1202–3.

20 For a comparative review, see Louis Favoreu, “Constitutional Review in Europe,” in Constitutionalism and Rights: The Influence of the United States Constitution Abroad, ed. Louis Henkin and Albert Rosenthal (New York, 1990), 37.

21 See R. Daniel Keleman, Eurolegalism (Cambridge, MA, 2011).

22 On the evolution in U.S. law, see Herbert Hovenkamp, Enterprise and American Law: 1836–1937 (Cambridge, MA, 1991).

23 See Richard A. Posner, “The Federal Trade Commission,” University of Chicago Law Review 37, no. 1 (1969): 52.

24 The concepts are identified and highlighted in Paul R. Verkuil, “The Emerging Concept of Administrative Procedure,” Columbia Law Review 78, no. 2 (1978): 264–65.

25 Much of the material in this section is based on my detailed study of the evolution of competition law in Europe. For details, and copious references, see David J. Gerber, Law and Competition in Twentieth Century Europe (Oxford, 1998); and Gerber, “The Origins of the European Competition Law Tradition in Fin-de-Siecle Austria,” American Journal of Legal History 36, no. 4 (1992): 405–40.

26 See Gerber, “Origins.”

27 Herbert Hovenkamp insightfully analyzes the impacts of marginal economics on competition law thinking, in general, and on the evolution of U.S. antitrust law, in particular, in many works. See, for example, Hovenkamp, “The First Great Law and Economics Movement,” Stanford Law Review 42, no. 4 (1990): 993–1058.

28 See, for instance, Gerber, Law and Competition, 54–62.

29 For details, see Gerber, Law and Competition, 121–35.

30 See Gerber, Law and Competition, 153–59.

31 See David J. Gerber, Global Competition: Law, Markets, and Globalization (Oxford, 2010), 21–52.

32 For details, see Gerber, Law and Competition, 34–52.

33 See Klaus J. Hopt, “Restrictive Trade Practices and Juridification: A Comparative Law Study,” in Juridification of Social Spheres: A Comparative Analysis in the Areas of Labor, Corporate, Antitrust and Social Welfare Law, ed. Gunther Teubner (Berlin, 1987), 291–331.

34 See, for example, Eleanor M. Fox, “GE/Honeywell: The US Merger That Europe Stopped,” in Antitrust Stories, ed. Eleanor M. Fox and Daniel A. Crane (New York, 2007), 331–60; and William E. Kovacic, “Transatlantic Turbulence: The Boeing-McDonnell Merger and International Competition Policy,” Antitrust Law Journal 68, no. 3 (2001): 805–73.

35 The following paragraphs are little modified from a fuller discussion of the conflict in Gerber, David J., “The European Commission's GE/Honeywell Decision: US Responses and Their Implications,” Journal of Competition Law 87 (2003): 8795Google Scholar.

36 William Kolasky and Leon B. Greenfield, “The Lost GE/Honeywell Deal Reveals a Trans-Atlantic Clash of Essentials,” Legal Times, 30 July 2001, 28.

37 Gary Becker, “What U.S. Courts Could Teach Europe's Trustbusters,” BusinessWeek, 6 Aug. 2001, 20. In a letter to the European authorities, senator Ernest Hollings, chair of the Senate Commerce Committee, stated that the European Commission had applied “an apparent double standard” that favored European companies and disadvantaged their U.S. competitors.“U.S. Steps In over EU Opposition to G.E. Deal,” Financial Times, 16–17 June 2001, 1.

38 See, for instance, Donna E. Patterson and Carl Shapiro, “Transatlantic Divergence in GE/Honeywell: Causes and Lessons,” Antitrust, Fall 2001, 22.

39 See, for example, William J. Kolasky, “Conglomerate Mergers and Range Effects: It's a Long Way from Chicago to Brussels,” address, George Mason University Symposium, Washington, DC, 9 Nov. 2001, http://www.usdoj.gov/atr/public/speeches/9536.htm.

40 See Sweet, Alec Stone, Governing with Judges: Constitutional Politics in Europe (Oxford, 2000)CrossRefGoogle Scholar.

41 On this use in the United States over time, see Michael Kammen, Mystic Chords of Memory: The Transformation of Tradition in American Culture (New York, 1991).

42 For in-depth discussion of these developments, see Gerber, Global Competition, 19–270.