In: Economics
let talk about the Anti trust laws,
Could you guys talk about the impact of the Sherman act and the Clayton on the american business?
Sherman Act and Clayton Act are the two of the most important laws that prohibited monopolization and anti-competitive practices in the American Business Environment. To prevent the arm-twisting tendencies of the big businesses and tendencies of the firms to form cartels and restrict entry of the new firms, Sherman act was created in 1890. It helped to create a business environment that was free from anti-competitive practices. But, it required an upgrade and Clayton Anti-trust act was created in 1014. It was more detailed, came up with the process to eliminate the prohibitive trade practices, implement the practices that protect the best interests of the consumers. It also came up with the exemptions so that it will not discourage the big companies who operate at a level of economy of scale. These anti-trust laws famously prohibited Microsoft from applying anti-competitive practices when Microsoft Bundled Internet explorer with Windows OS against Netscape Navigator browser. On a similar note, these laws helped building a business environment where small companies could also operate without fear of being bullied by the big companies. Such laws create an American business landscape where numerous new patents and other copyrights are filed every year and small innovators can also flourish along with the big MNC companies. In this sense, these acts have a huge impact upon the American business environment.