Ramsi Woodcock

CV

Writing

I use principles from “Econ 101” to identify changes in the antitrust laws that would lead to a more just distribution of wealth between buyers and sellers without reducing economic efficiency.

I see technology as fundamentally changing the rules of the game in the conflict between distribution and efficiency, creating ways in which markets can be made both fair and efficient.

I am organizing a conference right now. Submit your paper to Inframarginalism & Internet: A Conference on Markets as Wealth Distributors and the Implications for Tech Policy.

Recent Work

Personalized Pricing

Personalized pricing—the use of data and algorithms to charge prices based on personal characteristics—is pretty scary, because in theory it could enable firms to charge consumers the maximum they are willing to pay for each product they buy. In Personalized Pricing as Monopolization (Conn. L. Rev. 2019), I argue that the threat to consumer welfare is grave enough to justify antitrust intervention to stop the practice before it becomes widespread. Why antitrust? Because to personalize different prices to different people, a seller must be able to prevent consumers from trading with each other. That is anticompetitive conduct.

But personalized pricing is also a tremendous opportunity for redistributivists, because redistribution with personalized prices is guaranteed to be efficient. Personalized prices need not price willing buyers out of markets—the principal efficiency concern associated with redistributive pricing—because personalized prices can be tailored to ability to pay.

In my working paper, Personalizing Prices to Redistribute Wealth, and in Big Data, Price Discrimination, and Antitrust (Hastings L.J. 2017), I argue that antitrust enforcers and utility regulators today have the power to order the personalizing of socially-just prices—higher for the rich, lower for the poor. That is because antitrust’s consumer welfare standard gives antitrust enforcers authority to take wealth distribution into account, and the authorization to impose “just and reasonable rates” contained in utility statutes does the same for rate regulators.

The Radical Consumer Welfare Standard

As this work suggests, I differ with other antitrust progressives in that I do not see antitrust’s consumer welfare standard as a barrier to law reform, but rather as an opportunity. The consumer welfare standard has made redistribution easier, not harder, because it establishes that antitrust is not just about promoting competition, but about achieving a distributive goal: the maximization of the wealth of consumers.

In The Antitrust Duty to Charge Low Prices (Cardozo L. Rev. 2018), I argue that this change alone should be enough to induce antitrust to treat excessive pricing as a standalone offense, as the European Union already does. The concern that courts will misclassify at-cost prices as excessive prices can be allayed by making the remedy nominal damages, and leaving it to public opinion and reputational harm to enforce judgments.

In The Antitrust Case for Consumer Primacy in Corporate Governance (UC Irvine L. Rev. 2020), I argue that taking the consumer welfare standard seriously would also resolve one of the most important debates in corporate law: whether the purpose of the firm is to maximize profits and turn them over to shareholders or to run the firm to achieve social justice.

The answer is that antitrust requires that firms should earn no profits at all, much less turn them over to shareholders. Instead, firms should charge the lowest possible prices consistent with achieving efficiency in their operations, to the end of ensuring that consumers alone enjoy all of the surplus generated by production.

The consumer welfare standard also plays a starring role in The Efficient Queue and the Case against Dynamic Pricing (Iowa L. Rev. 2020), my critique of the use of data and algorithms to jack up prices in response to unexpected surges in demand. Industry argues that such “surge pricing” attracts new supply, but I argue that selling out at a low price does that too. As we have learned from the pandemic, “sold out” signs scream “opportunity” just as loudly as does a rising price. The only difference is that surge pricing impoverishes consumers.

Advertising

Technology is also changing the terms of debate in advertising. In The Obsolescence of Advertising in the Information Age (Yale L.J. 2018), I argue that the vast amount of free product information made available by the Internet has eliminated the only major efficiency rationale for advertising: the dissemination of useful product information. Now that consumers can get their product information elsewhere, the only remaining function of advertising is anticompetitive: to manipulate consumers into purchasing products that they do not really prefer, disadvantaging firms that may be better but fail to advertise.

Using the antitrust laws to challenge advertising may sound crazy, but there is actually plenty of precedent. The Federal Trade Commission attacked advertising as anticompetitive conduct throughout the 1960s and 1970s and won a number of cases, including at the Supreme Court.

Error Costs

Finally, in The Hidden Rules of a Modest Antitrust (Minn. L. Rev. 2021, forthcoming), I argue that the Supreme Court’s aversion to blanket rules of per se illegality in antitrust is deeply flawed, because too much nuance in antitrust adjudication is not economical.

Antitrust enforcers simply lack the resources to engage in the bespoke application of law to facts that the Court requires today under the “rule of reason.” But this introduces a startling bias into the law as applied. Enforcers cannot save money by unilaterally imposing per se rules of illegality, because only courts can authorize changes in the law. But enforcers can and do save money by creating per se rules of legality, because that just means engaging in less enforcement.

The result is that while the Supreme Court believes that in embracing rules of reason it has made antitrust more accurate, in fact the Court has merely succeeded at reducing enforcement. Unless the Court believes that the low tide in enforcement it has created is a good thing—in which case the Court should decide for itself which rules to eliminate, instead of leaving it to the whim of enforcers to decide—the Court must embrace more rules of per se illegality in antitrust.