Review of Industrial Organization 19: 27–36, 2001.
© 2001 Kluwer Academic Publishers. Printed in the Netherlands.
Delusions Regarding the Proper Role of Markets
and Antitrust Policy
DENNIS C. MUELLER
Department of Economics, University of Vienna, BWZ-Bruenner Strasse 72, 1210 Vienna, Austria
Abstract. William Curran and Donald Wellington have criticized capitalism, neoclassical economics
and antitrust policy. This article defends capitalistic institutions against both the strong forms of
socialism as practiced in the former Soviet Union and against its milder forms as practiced in the
welfare states of Europe. The article endorses some of Curran’s and Wellington’s concerns about
neoclassical economics, but recommends that neoclassical economics be adapted to make it more
useful for scientiﬁc research rather than abandoned outright. Some suggestions are offered in this
direction. The article totally rejects the notion that antitrust policy can be a tool for correcting the ills
of capitalism as Curran and Wellington see them, and argues that the goal of antitrust policy should
be to improve capitalism not to destroy it.
Key words: Antitrust policy, capitalism, neoclassical economics.
William Curran is very unhappy. He is unhappy about capitalism, unhappy
with economists and their methodology, and unhappy with U.S. antitrust policy.
Moreover, he seems to feel that they somehow all go together and reinforce one
I too on occasion have criticized the methodology of neoclassical economics
and U.S. antitrust policy, although with less passion and fewer footnotes than Cur-
ran. Both are easy to criticize and many have done so. Many have, of course, also
criticized the institutions of capitalism. What is more difﬁcult is to offer construct-
ive alternatives to each. Here neither Curran nor Wellington have much to say.
Curran alludes to “democratic socialism” in a couple of places, and Wellington im-
plicitly seems to favor some form of socialism, democratic or otherwise, also. But
they do not hold the institutions of socialism and the methodology of economists
who advocate it up to the same critical yardstick that they apply to capitalism. If
they did, they would ﬁnd its weaknesses every bit as bad as those of democratic
All of the references in Wellington’s paper save one – and that just barely –
are from before the 20th century, and Curran also seems to be caught up with
ideological and methodological debates of yesterday. Neither seems to have noticed