Populist Antitrust: The Case of FTC v. Facebook

A novel theory of antitrust law may be tested in the case of Federal Trade Commission (FTC) v. Facebook. It focuses on how pricing might be monopolistic even when the goods delivered to end users are zero-priced. While there is considerable political momentum behind a regulatory push to toughen antitrust sanctions on digital platforms in general and Facebook in particular, the economic theory behind the Government’s antitrust case is shown to be uncompelling. That does not mean it will necessarily be rejected by a given court, but the chances of the case succeeding and then surviving the full gamut of appeals is low. However, that predicted outcome may well calibrate the considerable space between the existing legal equilibrium and an emerging electoral policy equilibrium. If so, the expected outcome may well fuel the populist movement pushing legislation to fundamentally alter the antitrust statutes.