Rev Austrian Econ (2006) 19: 203–215
Robust political economy: The case of antitrust
Springer Science + Business Media, Inc. 2006
Abstract The notion of robust political economy is applied to antitrust. It is argued that the
universalizability of policy rules is crucial if both the knowledge problem and the incentive
problem in antitrust are taken seriously. Policy recommendations of Williamson are compared
with those of Hayek. It is further argued that the notion of universalizability is central not
only with regard to antitrust but also with regard to a host of other policy areas.
JEL Code B52, B53, D02, D80, K21, K40, L40.
The concept of “robust political economy” has recently been proposed by Boettke and Lee-
son (2004). They call a theory robust if its policy implications are not sensitive to speciﬁc
assumptions being fulﬁlled. They identify two general criteria that all policy-relevant theories
would have to cope with namely (1) the incentive problem and (2) the knowledge problem.
The questions that a robust political economy would have to pass are: (1) do the policy im-
plications still hold if we assume less than benevolent decision-makers and (2) do they still
hold if knowledge in a particular case is limited, asymmetrically distributed etc.?
In this paper, the notion of robust political economy is applied to antitrust or competition
policy. From a liberal perspective that is based on the assumption that a functioning market
can help us deal rationally with both incentive as well as with knowledge problems, this is a
pertinent question as antitrust institutions belong, at least potentially, to those institutions that
The author thanks his collaborators Lorenz Blume, Kim Eun Young, Janina Satzer and Michael Seebauer as
well as Anne van Aaken for helpful comments and suggestions.
S. Voigt (
Professor of Economic Policy, Economics Department, University of Kassel, Nora-Platiel-Str. 4,
D-34127, Kassel, Germany