Antitrust Externalities

Document Type

Article

Publication Date

9-2026

Abstract

The outsized economic and political power of leading technology companies has raised growing concerns, culminating in demands to break them up. Most of the scholarly evaluation on such structural remedies focuses, understandably, on antitrust law. But breaking up a tech giant would shape the societies beyond market competition, generating broader positive and negative externalities. This Article examines those externalities, including effects on the innovation ecosystem, data privacy, harmful online content, national security, and democracy. Antitrust doctrine and enforcement today have no principled way to deal with such externalities. Incorporating them into antitrust analysis would present governments with difficult trade-offs without any obvious value-neutral way to reconcile competing policy objectives. But disregarding such externalities may lead to net welfare losses for consumers and the broader society whenever the remedy undermines other social values such as national security. In contrast, antitrust remedies can lead to additional welfare gains whenever the remedy creates positive externalities such as revitalizing democracy. Negative policy externalities may offset or even exceed the benefits of antitrust intervention, whereas positive policy externalities may reinforce the case for antitrust intervention. After identifying key antitrust externalities, this Article outlines a more systematic way to account for them in antitrust doctrine and enforcement.

Disciplines

Antitrust and Trade Regulation | Law | Privacy Law

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