Antitrust Law Daily Wrap Up, ANTITRUST NEWS: AAI releases sixth paper in report on antitrust, entrepreneurship, (Aug 12, 2016)
Organizations Mentioned:American Antitrust Institute
By Greg Hammond, J.D.
The American Antitrust Institute (AAI) has released the sixth installment in its Report on Antitrust and Entrepreneurship, entitled "Boundedly rational entrepreneurs and antitrust." The article’s author, Avishalom Tor, discusses entrepreneurial activity and how it affects antitrust law and policy from a behavioral perspective.
Tor examines how two behavioral phenomena—overconfident beliefs and risk-seeking preferences—facilitate boundedly rational entrepreneurship. He notes that unlike "hypothetical, perfectly rational" entrepreneurs, real people are "boundedly rational," because "they possess limited cognitive resources and their behavior is partly shaped by affect and motivation." However, Tor writes that "overconfident or risk-seeking entrants compete with their more rational counterparts and create a postentry landscape that differs markedly from the picture assumed by traditional economic accounts of entrepreneurial activity."
The Report on Antitrust and Entrepreneurship will consist of seven papers that examine the important relationship between entrepreneurial activity and competition policy and enforcement. AAI notes that its focus on antitrust and entrepreneurship is "motivated by the importance of entrepreneurial activity for competition and economic growth."
News: Antitrust