Competition law  

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 +'''Competition law''' is a [[law]] that promotes or seeks to maintain [[market competition]] by regulating [[anti-competitive]] conduct by companies.
-'''Henry Calvert Simons''' (October 9, 1899 – June 19, 1946) was an American economist at the [[University of Chicago]]. A protégé of [[Frank Knight]], his [[Competition law|anti-trust]] and [[monetarist]] models influenced the [[Chicago school of economics]]. He was a founding author of the [[Chicago Plan]] for [[monetary reform]] that found broad support in the years following the 1930s Depression, which would have abolished the [[fractional reserve banking]] system, which Simons viewed to be inherently unstable. This would have prevented unsecured bank credit from circulating as a "money substitute" in the financial system, and it would be replaced with money created by the government or central bank that would not be subject to bank runs.+==See also==
- +* [[Consumer protection]]
-Simons is noted for a definition of [[economic income]], developed in common with [[Robert M. Haig]], known as the [[Haig–Simons income|Haig–Simons equation]].+* [[European Union competition law]]
- +* ''[[The History of the Standard Oil Company]]'' (book)
-==Work==+* [[Institute for Consumer Antitrust Studies]]
-===Program of reform===+* [[Irish Competition law]]
-In one of his essays, ''A Positive Program for Laissez Faire'' (1934) Simons set out a program of reform to bring private enterprise back to life during the [[Great Depression]].+* [[Competition regulator|List of competition regulators]]
- +* [[List of countries' copyright length]]
-<blockquote>Eliminate all forms of monopolistic market power, to include the breakup of large oligopolistic corporations and application of anti-trust laws to labor unions. A Federal incorporation law could be used to limit corporation size and where technology required giant firms for reasons of low cost production the Federal government should own and operate them... Promote economic stability by reform of the monetary system and establishment of stable rules for monetary policy... Reform the tax system and promote equity through income tax... Abolish all tariffs... Limit waste by restricting advertising and other wasteful merchandising practices.</blockquote>+* [[Relevant market]]
- +* [[Resale price maintenance]]
-Henry Simons argued for changing the financial architecture of the [[United States]] to make [[monetary policy]] more effective and mitigate periodic cycles of [[inflation]] and [[deflation]]. The goal of changing the "monetary rules of the game" in this way was to "prevent… the affliction of extreme industrial fluctuations".+* [[SSNIP]]
- +* [[United States antitrust law]]
-===Corporate finance and the business cycle===+* [[Sherman Antitrust Act]]
-According to Simons, financial disturbances in the economy are perpetuated by "extreme alternations of hoarding and dis-hoarding" of money. [[Short-term obligations]] (loans) issued by banks and corporations effectively create "abundant (fiat) money substitutes during booms". When demand becomes sluggish, a sector of the economy undergoes a shrinkage, or the economy as a whole begins to lapse into [[Depression (economics)|depression]], "hopeless efforts at [[liquidation]]" of the secondary monies, or "[[fire sale]]s," result.+
- +
-Simons believed that a financial system so structured would be "repeatedly exposed to complete insolvency". In due course, government intervention would inevitably be necessary to forestall [[insolvency]] due to traders' bad bets and [[margin call]]s by lenders.{{citation needed|date=March 2018}}+
- +
-A recent example would be the $10 billion bailout by the [[Federal Reserve]] of [[Bear Stearns]], a multinational global investment bank, in 2008. [[John Mauldin]], a senior member of the financial services industry, writes: "If Bear had not been put into sound hands and provided solvency and liquidity, the credit markets would simply have frozen… The stock market would have crashed by 20% or more… We would have seen tens of trillions of dollars wiped out in equity holdings all over the world." The Bear Stearns debacle was a watershed event in a housing market crisis that precipitated massive devaluations, left the economy reeling, and required massive government action.+
- +
-This is the chain of events predicted by Henry Simons in the event of a large-scale liquidation of inflated securities such as mortgage loans. In [[Economic Policy for a Free Society]] Simons writes that all it takes to precipitate a massive liquidation of securities is "a relatively small decline of security values". Simons is emphatic in pointing out that corporations that traded on a "shoestring of equity, and under a mass of current liabilities" are "placing their working capital precariously on call," and hence at risk, in the event of the slightest financial disturbance.+
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Competition law is a law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies.

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