Published online by Cambridge University Press: 03 March 2009
This article uses the history of the Whiskey Trust to explore the competitive effects of vertical restraints such as exclusive dealing. The Whiskey Trust distilled alcoholic spirits and bribed distributors not to carry competing brands of spirits. For the Whiskey Trust, exclusive dealing was an ineffective predatory strategy. Despite the trust's market dominance and manifold predatory strategies, it failed to preempt entry. The trust failed, in part, because its rivals could vertically integrate at low cost. Competition disciplined the trust more effectively than did numerous antitrust suits.