Creative Discussion, Episode One: Herb Hovenkamp

Join Joseph Coniglio, director of ITIF’s Schumpeter Project on Competition Policy, as he inaugurates Creative Discussion: An Antitrust Podcast by engaging in an in-depth discussion with Herb Hovenkamp, James G. Dinan Professor at the University of Pennsylvania Law School. Dubbed the “Dean of Antitrust” by The New York Times, Hovenkamp shares his career journey, insights on his influential Areeda-Hovenkamp Treatise, and perspectives on significant antitrust issues such as the consumer welfare standard and current antitrust litigation targeting Big Tech.

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Joseph V. Coniglio: All right. Thank you for joining us. My name is Joseph Coniglio and I'm the Director of Antitrust and Innovation at The Schumpeter Project here at ITIF, the Information Technology Innovation Foundation. And I'm proud to announce the release of our first episode of our new Antitrust Schumpeter Speaker series, where we'll be channeling Schumpeter's idea of creative destruction and having wide ranging and in-depth discussions with really antitrust greatest luminaries to discuss cutting edge issues in antitrust, tech, economics, and even beyond. And hopefully also get to know a little bit more about our illustrious speakers and some of the people who have been extremely influential to say the least in US antitrust law. In that vein, I really could not be more thrilled to introduce for our inaugural episode, Herb Hovenkamp, the James G. Dinan University professor at the University of Pennsylvania, Carey Law School, who is without exaggeration, the leading scholar of US antitrust law and who has been dubbed by the New York Times and many others the Dean of Antitrust. He is of course the co-author of the very magisterial Areeda-Hovenkamp Treatise.

Along with hundreds of articles and other publications, well over a dozen books some of which I'm looking forward to discuss here, although it's impossible to cover it all before we do that, I'd just like to ask you, Herb, welcome to ITIF.

And maybe just tell us a little bit about your career path and your journey. How is it that one becomes the dean of antitrust law?

Herb Hovenkamp: Partly through misadventure I got my PhD in history with no antitrust in prospect, not even law. Went to law school a little bit later on and went to Harvard on a postdoc. This was a long time ago, 1980. Met Phil Areeda, who became a friend and was my mentor for several years. He asked me to join him in 1982 after he and Turner, Donald Turner was his co-author through the first five volumes of the Antitrust Law Treatise. They broke up and Turner left Harvard and Areeda asked me to join him. It was very much a senior-junior relationship for several years. Until 1990 when Phil was diagnosed with leukemia and his health began deteriorating, and I moved in and took over more and more of the treatise. Phil died in 1995 and I'd been pretty much in charge of it ever since.

Joseph V. Coniglio: Wow. So yeah, I, I would love to talk more about the treatise and really maybe start there when we get into your work. But, it's funny, a little anecdote about this. When I was first in private practice and the neo-Brandeisians were starting to take over I had a question from somebody I work with.

'Cause there was this stuff going around that, oh, all the antitrust lawyers just read Robert Bork all the time. And they have the antitrust paradox by their desk while they're advising clients. And somebody asked me, I said what do you do Joe, as a junior lawyer? And I said of course I open up the Areeda-Hovenkamp treatise.

But I thought everybody did that when they were starting a legal research or analysis. So, how do you see the purpose of the treatise in US antitrust law? What purpose does it serve?

Herb Hovenkamp: I think its principal goal is to explain the law in ways that are useful, unbiased, descriptive as much as prescriptive, although the treatise overall has a reputation for being more prescriptive than a lot of other treatises. I also see it as serving a kind bridge between antitrust lawyers and economists. That is, it tries to be economically sophisticated and enable lawyers who are litigating, or judges who, are mostly not economists, enabling them to understand what the economic issues are as well as the legal issues. That's my goal. So whether it's successful depends on how it gets used.

Joseph V. Coniglio: And the treatise obviously is a work in progress, that's continued over the decades, and I think, where are we right now? We're at the Fifth Edition that you're working on? 

Herb Hovenkamp: Just finishing the Fifth Edition. We're in the last three volumes of the Fifth Edition. My son Eric, who's a law professor as well, he's at Cornell, he's helping me on these last three volumes, which are on mergers. And then if all goes well, we'll do what I've been doing now for three decades, which is go back to the beginning and start out with the Sixth Edition. Never ends. 

Joseph V. Coniglio: Never ends. Now, are there any significant changes that you might highlight with the Fifth Edition? What have been some of the things that maybe you focused on this round? 

Herb Hovenkamp: Yeah, quite a bit of rewriting in the merger area. Thanks in part, to changes in the administration, changes in the guidelines things like that. I think the biggest changes other than that are in the chapters on monopolization which have tried to take into account things related to Big Tech, two-sided markets, the measurement of market power, particularly on digital networks. Those have been difficult and challenging issues for federal judges and the treatise tries to walk them through that and make some sense out of it. Of course, to the extent there's a lot of disagreement among economists and that remains a big issue in in tech, how you measure market power on two-sided markets. We take the best shot we can try to present both sides. Favor one if I think it needs to be favored and see what happens.

Joseph V. Coniglio: Yeah, I think the value of the treatise somewhat speaks for itself, right? Because it's been cited over a thousand times, I believe, in federal courts, right? So clearly the role that it has played really can't be exaggerated. It's influential and rightly so. Moving away from the treatise, maybe Herb and maybe a little bit of a lighter question before we get into some of these real big antitrust issues that I wanna discuss, but you've written so much over the years, your output, by consumer welfare output standard, Herb, I think we're doing very well.

Do you have any favorite article that you've written or one that maybe you're most proud of or something you come back to and say, I really got that one. 

Herb Hovenkamp: I think I have two, if I can give two.

One was a piece called Antitrust Policy After Chicago. It was published in the 1985 Michigan Law Review. It's been credited with some people for kinda getting post Chicago antitrust off to a start. I don't claim that myself, but it was a critique of. Where we stood with the Chicago School at a time when the Chicago School was still it was better regarded than it is today. The second piece is one called Antitrust and Platform Monopoly, which is in the Yale Law Journal about five years ago. And in that one I tried to take on a lot of issues involving, single firm contact conduct on dominant digital tech platforms. They've both been pretty well cited and I think those are the two pieces I'm proudest of.

Joseph V. Coniglio: We're gonna get into, I think both of those, because part of what I wanna know is where does Herb Hovenkamp see himself? Chicago, Neo-Chicago, Neo-Harvard. You've been characterized in various ways, frankly by many folks. And of course, the tech cases too and all that we're gonna discuss.

But one article that I would like to take the privilege of asking you about specifically is one near and dear to our heart at ITIF and our work on Schumpeter in antitrust. You have a short piece on that, which I remember reading a long time ago when I started to get into dynamic antitrust and served to me as a starting point, right? For thinking about these issues. And I think the dynamic Schumpeterian approach, obviously a little bit en vogue right now with the recent Nobel Prize in economics and the general moment we're in when we're thinking about the future of antitrust law, given the inflection point we are, and here, we, with Schumpeter, you talk about, and I think one of the things you say is, it's getting away from the Neoclassical model. A little bit, which I know we'll discuss. And it seems like Schumpeter has a lot of great insights, but how do you take that and apply it to antitrust law in a rigorous way?

And that's similar to what economists like Demsetz pointed out a long time ago where you have these difficulties, let's say, measuring static and dynamic welfare trade-offs. But is there a sense in which maybe Schumpeter, we can work that into antitrust a little bit more?

What's your view?

Herb Hovenkamp: I think one clear effect and I'm not sure how much of this is expressly owing Schumpeter and how much to developments in tech. And that is, we always think of consumer welfare as a three-legged stool price, output, and innovation. And I think the innovation part of that has come to play a bigger role in the last, oh, decade or two than it did previous to that. Because a lot of antitrust concerns today. Are best understood for their impact on innovation. And there, I think the biggest thing that antitrust can learn is that within the Schumpeter arrow framework or, and Solo can't forget Robert Solo. Innovation is a much greater contributor to economic growth than is competition under constant technology. That's an important thing for things like patent policy and other parts of federal policy. The flip side, which is important for antitrust, is that if innovation is. Such a strong contributor to economic growth, then restraints on innovation can do much more considerable harm. And that's one thing I think antitrust needs to think about more. That a restraint on innovation can be more harmful than a simple restraint on pricing or output in a static market. And of course, if you look at the array of big tech antitrust cases. That we've been following now for the last 10 years or so. Innovation and innovation effects have played a much more prominent part than they have in the past and in a different way in which I think there's a, an increasing awareness that innovation is valuable even though it may lead to very large firms and very different from, say the approach back in the late sixties and seventies in the IBM case where innovation was also often thought of as the enemy to be countered rather than something that should be facilitated.

Joseph V. Coniglio: Certainly that's been a perennial issue with antitrust, in the 1960s, right? Low prices were an enemy, right? Because they harmed competitors. And same thing with innovation. Even more but that's interesting. When I hear you, Herb, it seems like you're saying that innovation is something that can be incorporated sufficiently well within the sort of neoclassical consumer welfare framework.

And maybe it's not something that we need to adopt a more thoroughly dynamic, non-neoclassical approach to antitrust law. And I think that's a debate that we can have. But in that vein, and stepping back as we get into your broader worldview and then drill back down into antitrust.

How do you see the relationship between, let's say, antitrust and broader democratic goals? How should we think about that?

Herb Hovenkamp: First of all, I think they're subordinate to economic goals, and that's a matter of pure statutory interpretation. Every single liability creating word in the antitrust statutes, monopoly, restraintive trade, substantially lessen competition. Those are all economic words, and they don't give us any, any explicit authority to go after things unless they restrain output price or innovation. Now, on the other hand I think it's quite easy to draw conclusions about the impact of widely dispersed power. Economic competition for democracy. And to that extent democratic countries tend to have robust antitrust policies. As the Soviet Union fell apart it, and its satellites began enacting antitrust laws. So, there's always a correlation there. But the statutory language has to be what drives policy and in the United States, that means the language of the Sherman and Clayton acts.

Joseph V. Coniglio: All right. There, I think there is a debate there though. I, this idea of the Sherman Act is a common law statute. I think one way to think about that is, we have these terms, the textual analysis, but it really doesn't tell us too much about what competition is in itself, whether it's rivalry, whether it's neoclassical equilibrium.

And if you look at the legislative intent, maybe you do get some purposes that are beyond the traditional economic goals. 

Herb Hovenkamp: You do, but they're at the, they're at the fringes. I'll give you an example what I think of as a bad example, which is, justice Thurgood Marshall's opinion in the Topco case. That case has a couple of widely quoted phrases. 

What did he do in that case? He ended up condemning a pro-competitive joint venture that could never possibly have reduced output or increased price given the one and a half percent market share. That it's, that its members had, so there's a lesson to be drawn there, and that is if you wanna bring in the political theory, you don't want to ignore the economics, so you end up just making serious mistakes.

Joseph V. Coniglio: You do have another article, which I would commend. Whatever Did Happen to the Antitrust Movement? And I think you wrote that in 2019, and I think certainly the past several years we've seen the populist antitrust movement come back in some ways with a vengeance. And I guess I would just ask you now, drilling into where we are in the current antitrust movement.

Joseph V. Coniglio: How do you see things? Is the old order, so to speak, the old consumer welfare order with its various post- Chicago, Harvard, Neo-Harvard factions in trouble? Or does that still provide a model for the future of antitrust? How do you see the current moment?

Herb Hovenkamp: I don't think it's in trouble. I don't like the term consumer welfare, and I'll tell you why, and that is because it has a definitional problem. A lot of people still associate it with Robert Bork. The fact is, if you interpret consumer welfare the way Chief Justice White stated it in the standard oil decision that I quoted a few minutes ago, I think it's a perfectly defensible paradigm.

It's the best paradigm for antitrust to have, but you gotta keep your focus on low prices, high output. Unrestrained innovation. And I think if it's viewed that way, number one, it's durable. Number two, its value has been confirmed now in two recent elections.

This became crystal clear just this past Tuesday. High prices, the high cost of living. They want to see more competition in markets with the ability to bring prices down. Now, voters usually don't talk about output. They don't say things like the output of eggs is too low. Now they say the price of eggs is too high, but it means pretty much the same thing.

But I think if antitrust can keep its eyes on that ball, number one, it's complicated enough. And number two, it is effective and it is consistent with the wishes of American voters, which tells me that it is the ultimate populist position. Populists love low prices, high output, and unrestrained innovation. They might not say it exactly that way, but ultimately, I think that's what most of them like. It's really quite shocking. For example, when you look at, broader surveys. Like Gallup does, I think it's actually a monthly survey of people's concerns. And you see the top half dozen of them are all related to costs, prices, inflation and pocketbook concerns. Big business doesn't even appear on the list. And as a result the people who claim to be populist, but yet redefine it as targeting big business rather than lower prices. That's just fake populism, that somebody's made up idea of what he or she thinks populists should be thinking, but it's not what they're actually thinking.

Joseph V. Coniglio: Schumpeter of course, I think is great on this, Herb, where he talks about how basically democracy is really this inter-elite competition. And in many cases, what seemed to be populism are these warring, factions between, so to speak different elites. And I think a lot of us would say the neo-Brandeisian movement, in particular, was much more a pseudo intellectual, elite driven movement, rather than it was people that really hated their iPhones or we're just up in arms about the green bubbles, for example, I certainly take that point, but I don't think we're breaking news here to say you don't like the consumer welfare standard. I think you've probably said that before, but it is worth drilling down a little bit.

And I know you've been very vocal about the importance of output rather than price. And I guess just one question I would ask here, and I think this is underappreciated, from an administrability perspective, which I think is something that, let's say the Harvard folks took very seriously.

Prices, I think in some ways are a lot easier to see in the market. And analyze price effects. Output can be tricky. How do you reconcile that?

Herb Hovenkamp: It depends entirely on the question, but you're right. Price and output are two blades of the same scissors. 99.999% of the time demand curves slope downward, and as a result, price and output are linked in that way. I think there's been excessive focus in the scholarship, particularly the Fringe scholarship on that minuscule group. Situations where they go in the other way. But then it turns out, when we're measuring welfare, output is relevant, right? When we do things like assess economic growth, we measure it by looking at the output of goods and services. On the other hand when we're doing things like measuring relevant markets. We generally look at price elasticities, right? The snip test for mergers looks at a small but significant and non-transitory increase in price as determining substitutability as between products. So, each of them performs a valuable function depending on what kind of question we're asking. I think in the public mind, certainly in the political mind awareness of price is paramount. Because people experience price, right? People know what the price of eggs is, they don't know what the output of eggs is. Nevertheless, if you're interested in productivity over the long run, or even over the shorter run, you have to pay a lot of attention to output. And of course, a lot of our lower prices come from enabling ourselves to be free of constraints on output.

Joseph V. Coniglio: And I guess a broader question here, Herb, getting into an article you wrote relatively recently on the Looming Crisis in antitrust economics. How do you see maybe economics going wrong? What, where do we wanna double down this consumer welfare focus. But at the same time, you identify some issues in that article about why there could be tensions there.

Could you maybe talk a little bit about that? One of them I know you highlight is the Ohio v. Amex case, right? And this idea of how they define platform markets there. And at least at one level, right, that's the sort of output focused approach, that perhaps you might be sympathetic with.

Herb Hovenkamp: First of all, yeah, I did think Ohio v. Amex got the market definition question wrong. I think by the way, the government today is doing it, if you look at all the recent big tech cases, they define markets almost entirely by relation to user data, and as they look at one side, this has been a huge issue in market power of two-sided platforms.

How do you assess differential effects on the two sides? And that's what caused the court in the Amex case to decide that the relevant market was transactions. Transaction has both a buyer and a seller, so it's not really a very helpful way to define a market. But if you look at the Google cases search, for example, the market is addressed as user market share, not advertiser market share, but user market share. If you look at Facebook, all the fighting going on right now about what the market definition is in the Facebook case is all driven by user market share. When we look at Apple and Android, we're looking at user market share. We're looking at one side. Is that wrong?

No, I don't think it's wrong. I think it's presumptively right to look at user market share. Number one, life is short and these cases are complicated. And number two, however, I do think user market share ought to be presumptive rather than absolute. So, if you're the defendant, and you wanna provide some evidence that user market share overstates the market power of a certain of a certain product, I can give you an example of that in digital products. One feature, one feature of digital production is that although entry might be hard for somebody who's already entered, the ability to increase output is virtually unlimited. If you have a digital product, you can increase the number of users frequently at very low cost except for capacity constraints. What does that mean? That means that a snapshot of market share might exaggerate your power, because the fact is that if you attempted to raise your price, you would immediately be offset by increased output from your rival. So this, rule that you look at, the user side needs to be presumptive, but I think it serves to keep cases manageable. I think it's asking basically the right question and I applaud the Justice Department for, and the FTC for taking that approach in these big two-sided platform cases. And largely ignoring Amex in the process because they're not adopting the view that market share is transactions, as Amex said. No, it's based on user side. And apropos of that, I just emphasize one thing I tell my class too many times, market definition pertains to products, not to firms. That is something people get endlessly confused about. The anti-monopoly movement is way too confused about it because they're always trying to assess. Power by looking at firms.

But market power is a function of firms. So, if you're talking about Microsoft, you get one number for Windows, something in the 70% range for desktops and laptops. You get a very different number if you're looking at search engines, where Bing has something like a 5% market share as against Google search.

If you're looking at Microsoft share of the handheld operating system market, it's far less than 1%. So, you have to be very careful when you're talking about market power to make sure you're focusing on a product and not on the firm.

Joseph V. Coniglio: Since you go into the big tech cases, that's actually where I wanted to head next. And maybe we'll go in reverse order here and start with the question of remedies and breakups. You've been very vocal about this as a historian and legal scholar of antitrust law, about the role of breakups in monopolization cases, all the way back to Standard Oil, American Tobacco, United Shoe.

What lessons should the government and antitrust policymakers keep in mind when they're thinking of breaking up the Big Tech companies?

Herb Hovenkamp: The first lesson is that breakups should never be the preferred remedy. Maybe an available remedy, but they should never be the preferred remedy. And we have a long and quite sad history of, of them in that regard. I'll start out with Standard Oil. Standard Oil was formed as a trust of a union of several companies had that had been bound by corporate laws that restricted them to operating in a single state. The breakup in Standard Oil simply released those original trust members back to their original status. Out of that, we got: Exxon, Standard of Texas; SoCal, Standard of California; Ohio; Socony, which is Standard of New York. What the breakup did was basically create a whole bunch of regional monopolies instead of a single national monopoly. But they were big regions, there's no reason to think prices would come down or output would go up simply because you hack a monopoly up into some regional monopolies. Same thing happened in the Grinnell case.

What about AT&T? I think of the AT&T settlement as the most successful Section Two remedy that included breakups. However, when you start getting down into the AT&T case, the remedy broke the nationwide AT&T statutory monopoly into seven regional companies. Each one of them retained a monopoly in its particular region. There was some hope at the time that they would expand as clec into one another's region, but that never really happened until much, much later. The real gains from the AT&T settlement did not come from the breakups. They came from the interconnection obligations, which were of course later on enacted into the 1996 Telecom Act, and which provided for virtually global interconnection rights. And under that, we got the entry of literally hundreds of firms to turn the telephone network into the much more competitively structured regime it is today. "Break 'em up" is not the optimal solution in Section Two cases. And the most alarming incident, of course, was United Shoe Machinery. Where, how do you break up a company that operates out of a single plant located in Beverly, Massachusetts and the court under Justice Fortis, this is 1968 case, basically required United Shoe to set up an independent company as a competitor. And after that, the whole industry fell apart. Both the competitor and USM itself eventually went into bankruptcy. That's a complicated story, but we have nothing to be proud of in the history of Section Two breakups.

Joseph V. Coniglio: All right. So, breakup is a bad idea. But maybe, before we wrap up here, we'd love to get your thoughts on maybe some of the specific cases on the legal merits, on the liability issues with some of the Big Tech cases, and of course you've written, I think about all of them.

Google, Meta, Amazon, Apple. Maybe we might just take them briefly. The Google search case, obviously Judge Mehta did find that Google acted anti-competitively. I think some issues on appeal that Google might raise with respect to the causation standard he applied, other things. How do you see that liability issue?

Herb Hovenkamp: I think Judge Mehta did a first-class job on his remedies decision for a number of reasons. But first of all I agree with the liability finding. There's quite a bit of controversy about that, but I agree with the liability finding. Then the question is, what should the remedy be? He refused to force Google to spin off its Chrome browser, which got a lot of people heated up. I think that was absolutely the right choice. The Chrome browser is not part of the search monopoly. You don't break up the search monopoly at all. It was a complementary product and judge made it properly said. Doing something like that requires some kind of causal relationship between the existence or the creation of the monopoly and the ownership of Chrome. And the record simply did not establish that. I think the core of the remedies decision is this one time snapshot transfer of the file's database to a small but as yet unspecified group of licensees. I think that was a pretty good shot at a remedy. What it means is that each of these licensees, let's just say there are five or six of them, I don't know how many there are going to be will get access to the Google search database.

You probably know that when you do a search on Google, Google doesn't actually scour the internet. I think there's something like 50 billion records in the database of web pages and it keeps updating this continuously. It's two and a half times bigger than the Bing database, which is the second biggest search engine database. But by giving a few qualified firms that we can create something that you can never create with a divestiture, which is that firms that are actually head-to-head. Competitors with each other in the same product and in the same region. But then once they get that database, each of them will be expected to engage in further development on their own. And we may see search, turn into a more product-differentiated, competitively structured market. As a consequence one of the things Mehta emphasized was the rapidly expanding presence of gen AI. And it's gradual association with search engines with really no telling right now where it's going to go and that, that served really to undermine any argument for radical remedy. Now, it may have undermined the liability finding as well. He didn't go that far. The liability had already been established but at the very least, gen AI. Placed a lot of doubt on the ability of anyone to have good enough foresight to see what this market should look like and break it up in a way that would increase competition.

Joseph V. Coniglio: So, on the Google case, Herb, look I agree. I think there's certainly some idea that Judge Mehta did not impose the very sort of radical remedies.

But even on the data sharing, I wonder what the legal standard is there and this idea of denying the fruits, and specifically identifying what fruits Google got, from a data perspective as opposed to from anti-competitive means. 

Herb Hovenkamp: There was a lot of uncertainty in the liability opinion as to whether, how much of Google's dominance accrued from Google's own superior skill and how much of it accrued from the default payments. And frankly, he didn't know the answer to that.

Joseph V. Coniglio: On Amazon, another case I know you've written about. Obviously, the case we got from the FTC very different from the article that Lena put forward in her Amazon Paradox. But how do you, and I think generally folks recognize a lot of issues with this case.

How do you see that one playing out? I know you already mentioned some of the market definition problems.

Herb Hovenkamp: Okay, so Amazon raises two sets of antitrust issues. One has to do with the customer facing side of Amazon's power in product markets. And here I think the sad fact is that Amazon is not a monopolist in pretty much anything. Once again, market power resides in products, not in firms, and you need to divide up the products.

There are some internet-only products like streaming. Amazon's not the biggest streamer in movies, music games, or other firms that are larger. And then of course there's the whole list of millions of tactile products. Everything from shampoo to cosmetics, to kitchen appliances and clothing that Amazon sells. With respect to virtually all of them, Amazon has a non-dominant position that tells me two things. Number one they're not gonna be able to charge higher prices. I think the sentence in the complaint that speaks about charging higher prices on the internet, which is what the allegation is. I think that's badly designed for the simple reason that with respect to these products, competition straddles both the internet and the old economy. In fact, Amazon's biggest competitor in old fashioned tactile household products is Walmart. 88% of Walmart sales are in stores, not on the internet. And so, the market needs to include both offline and online sales. And when you do that, the prospect for a price increase are very low. And the same thing applies to analysis of the primary anti-competitive practice, which is variations on most favored nation clauses that penalize merchants who sell on Amazon if they charge at lower price elsewhere. We generally think of MFNs as being beneficial when they are, when they are negotiated by non-dominant firms like grocery stores for example, asked to take a, on a new product or a product in which they don't have much market share. They rightfully say I'm willing to sell this for you, but I wanna make sure you're not selling it at lower prices somewhere else.

That's a growth strategy. And as a result, I think that substantive part of the claim, it sounds to me to be pretty weak. Now, the other side of the story is Amazon fulfillment. That's the supply side of the story, which is also covered in the complaint that fulfillment can travel over a lot of different products.

It can be the, it's a service that applies to a lot of different products. Doesn't apply to all of them, like streaming, for example. I think there are serious questions about the extent to which. Entry barriers are high in fulfillment services. Can they be offered by competitors and so on? I think if the government has any chance of winning this case, it's gonna be on the fulfillment side rather than on the consumer facing side.

Joseph V. Coniglio: On the fulfillment side are you meaning to talk about the second tying claim that they're bringing? 

Herb Hovenkamp: Tying claims are on the, yeah, the idea that you tie the buy box. 

Joseph V. Coniglio: Yeah. I think that has its own issues, right? This idea that the buy box is a separate product.

Herb Hovenkamp: If the claim is that tying is leading to higher product prices, I think it falls apart.

If it's leading to some bias on the supply side. Let's see what the record says. I have to say I'm pretty skeptical. Somebody's gotta be in that buy box, and Amazon does have a set of criteria for determining who wins it. And the criteria of course have been criticized as being unreasonably favorable towards Amazon's own products. If that can be proved and we have to be able to show that prices are higher, output lower, and that market as a result, then there could be a plausible claim there. I'm overall pretty dubious about the Amazon case.

Joseph V. Coniglio: So, Herb as we wrap up here, I just wanted to end with a couple lighter questions after going through that. But my generation, we have what we call pump-up music, right?

And when I look at all your output and all your work, do you have any pump-up music, Herb? What gets you in the mood when you're starting to write these amazing articles?

Herb Hovenkamp: I have two mutually exclusive sets of playlists. I have pop music, favoring the eighties and nineties, I would say. Although I do Taylor Swift for when I'm doing lightweight work. When I get serious, I turn to classical music, they're mainly piano concertos, Mozart. I'm pretty old-fashioned when it comes to classical music.

That's what I like, and I have music on all the time when I'm working.

Joseph V. Coniglio: And with the treatise as you sit down to write and do you have any sort of pre-treatise ritual that you go through before you start to write even coffee, tea? What's the method there?

Herb Hovenkamp: No, I really don't. I have a schedule, which is six times a year every other month. I go through decisions, all court decisions, FTC decisions if they're related to antitrust and I make notes on them.

Joseph V. Coniglio: No secret initiation ritual for writing the treatise? 

Herb Hovenkamp: No, there's really not. I've been doing this a long time. may have been some rituals back in the beginning, but not anymore. It's pretty regularized.

Joseph V. Coniglio: Got it. Got it. Herb, this has been a lot of fun for me and I'm sure also very informative for me, and I'm sure all of our viewers thank you so much for taking the time. So to close out, I'm Joe Coniglio, director of the Antitrust Policy at ITIF, and it's been a distinct honor to kick off our inaugural Schumpeter project speaker series with none other than the Dean of Antitrust himself, Herb Hovenkamp.

The James G. Dinan Professor at University of Pennsylvania Law School. Thanks so much for tuning in and stay tuned for our second episode coming up next month. Thanks.

Herb Hovenkamp: Thank you very much.