The Equitable Economy

Elon Musk recently sued OpenAI over claims that the company has strayed from its social mission and has instead focused on profit maximization. Roberto Tallarita examines how Musk’s lawsuit shows well-intentioned corporate planners how hard it is to commit to an effective and enforceable social purpose and warns policymakers that relying on corporate self-regulation of AI could be a fatal mistake.

Nearly one in five American workers are affected by noncompete agreements, which prevent workers from working for or creating a rival firm. In new research, Axel Gottfries and Gregor Jarosch estimate that the Federal Trade Commission’s proposed noncompete ban could raise wages by 4%.

Competition authorities and analysts are increasingly focused on the impact of mergers and acquisitions on worker welfare. Using a novel dataset on Canadian firms and workers, David Arnold, Kevin Milligan, Terry S. Moon and Amirhossein Tavakoli test the empirical validity of several theories on how M&A may help or harm workers.

Critics of the Federal Trade Commission’s lawsuit last week to block the Kroger-Albertsons merger claim that the agency incorrectly limits the relevant buyer-side market to unionized grocery workers. Steve C. Salop argues that the critics are wrong, and that standard antitrust analysis shows the FTC has it right.

Luigi Zingales argues that Elon Musk is right to sue OpenAI and CEO Sam Altman, given the economic principles at stake.

Although the antimonopoly neo-Brandeisians and the labor movement share many goals, including a desire to reduce the power of big business, significant tensions exist, such as labor’s past support for mergers when they advance the ability of workers to unionize. Kate Andrias traces the history of labor’s relation with antitrust to show that, despite historical and contemporary tensions, there have also been deep connections between the two movements that show how they can better complement each other in the future.

In a new paper, Ilyana Kuziemko, Nicolas Longuet-Marx, and Suresh Naidu point to a shift in the Democratic Party’s economic policy, from predistribution to redistribution, as one of the reasons why it has lost less-educated voters.

How can investors use capital markets to encourage emissions reductions? In new research, Matthew E. Kahn, John G. Matsusaka, and Chong Shu examine whether public pension funds are more effective in mitigating pollution when they divest from fossil fuel companies or actively engage their management.

The following is an excerpt from Kyle Edward Williams' new book, "Taming the Octopus: The Long Battle for the Soul of the Corporation," now out at W. W. Norton & Company.

Business and economic thought instituted at least since the Reagan revolution in the United States have promoted firms’ narrowly self-interested, profit-maximizing conduct even at the expense of consumers and workers. This paradigm leads to social distrust and insufficient cooperation. Steven C. Salop explains this distortion and proposes 10 guidelines by which firms can self-moderate their behavior to produce prosocial outcomes.