CAN THE OWL OF MINERVA SPREAD ITS WINGS AND FLY?

With a powerful metaphor, philosopher Hegel described philosophy as the Owl of Minerva, which “only when the dusk starts to fall does it spread its wings and fly”. Philosophy comes only at the end of the day, as a descriptive reflection on what happened, and Hegel's owl cannot reverse the motion of the stars and stop the twilight. Economics is the philosophy of modern competition policy: economic theory, competition policy and competition law are inextricably intertwined. Ever since competition law came into existence, the economic theory of competition has exercised its influence upon it. Rules change as, and when, the underlying economic theory changes. As time went by, different paradigms (Neoclassical, Harvard, Chicago, Game theory) informed antitrust enforcement. Competition policy changes because the definition of competition, the way it works and how it can be promoted are not univocal and eternal tenets in the economic science.

Pretty much like Hegel's owl of Minerva, they rather followed changes in economic history and society. For instance, the theory of perfect competition is clearly modelled after the agricultural market, which was easier to observe when the competition was described as emerging among atomistic producers of homogeneous goods. Features of specific markets observed by economists in a given historical period did shape the content of an otherwise vague concept such as barriers to entry: economies of scale reflect the importance of the efficient plant size in classic manufacturing industries; capital investments reflect the historical scarcity of these assets before the improvement of legal tools to raise capital; the idea that aggressive advertising can be a limit to competition is linked to the emergence of traditional media such as newspapers and television, which created a limited number of powerful channels to reach consumers. Much of the reflection about distribution agreements, tying and bundling came of course after the emergence of department stores and distribution networks.

But unlike the owl of Minerva, which can only come to the scene too late to give instructions about how the world ought to be, economic theory does affect economic relations by informing competition law.