Thursday, February 15, 2024

Soda Prices are Too Low for the FTC

The FTC is investigating Coke and Pepsi for price discriminating. It has invoked the Robinson-Patman Act, otherwise known as the "Mom & Pop Protectionism Act." Most economists consider the act itself to stifle competition and innovation by restricting supply chain decisions. The legal profession also came around to this view such that the number of cases dwindled to zero. But, evidently, it is not dead yet.

The law, known as the Robinson-Patman Act, bars manufacturers from charging different prices to competing resellers of their products if the practice threatens to harm competition. The law is highly technical and hasn’t been enforced by the FTC in decades (emphasis added).

I can hear Dr. Frankenstein yelling, "It's alive! It's ALIVE!!!"


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