Discussion: As was mentioned in an earlier post, many small businesses end up going out of business. As an example, in my neighborhood, we had 3 gas stations that survived for years. Then a “big” company came in and not long after, the other 3 gas stations were out of business. They were smaller stations, but found they couldn’t “compete” because the larger company was able to lower the prices. Of course, as soon as they went out of business, gas prices went up at the big company. How do these laws help smaller businesses compete – if at all? Thoughts?

Antitrust law mainly focuses on market power – both individually or jointly with competitors, a company with enormous market power is a monopoly and does typically the following;

Price fixing – this happens when the price of a product is controlled/set by one market player deliberately without letting the market forces (demand and supply) fix it naturally. Although several firms may determine the price jointly. This action does not benefit small businesses because they have no control over the market forces. These laws ensure there is fair competition in the market to provide profitability for every market player.

Negation to deal – monopolies just like other competitors may choose on whom to do business with. But in the case if they use their market supremacy then small businesses will not be having a fairground to deal business in, these laws regulate market dominance by enhancing mergers and acquisitions to enable stability of small businesses.

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