Are the Remedies for the Common Ownership Problem Worse than the Disease? : Assessing the Likely Decision and Error Costs of Proposed Antitrust Interventions

Antitrust scholars have recently proposed additional interventions — beyond enforcement of traditional rules on hub-and-spoke conspiracies, collusion- facilitating devices, etc. — to police anticompetitive harms purportedly resulting from institutional investors' common ownership of small stakes in competing firms. They maintain that the current “enforcement passivity” on common ownership is unwarranted. Additional antitrust interventions are not justified, though, if they would create greater welfare losses than they would avert. This article considers the decision and error costs that would result from the interventions that have been proposed for remedying the purported problem of common ownership. It concludes that they would be substantial and would likely outweigh any benefits the interventions would secure