This study is an analysis of competition laws in the US economy. The United States economy is primarily a market economy in which the prices of services and goods are determined by the forces of demand and supply in a freely regulating price system. As such, enterprises are free to innovate and produce products that give them a competitive advantage in the market. However, the production and innovation by specific enterprises should not inhibit the ability of competitors to access the market through abusive practices such as predatory pricing, price gouging, tying etc. In order to establish a platform for ensuring fair play and fair competition by businesses, the US government has established the competition law, normally referred to as the antitrust law that seeks to further healthy business operations by protecting small businesses from extinction by other businesses due to practice of unfair business practices such as the formation of cartels or any involvement by businesses in transactions that may threaten a healthy competitive business environment.
The aim of this analysis is to scrutinize the anti trust law, especially with regard to United States vs. Microsoft in the Microsoft antitrust trial in which a set of civil actions were consolidated and filed against the company in May, 1998. The suit was filed in pursuance of Sherman Antitrust Act. To aid in the analysis, current micro and macro economics trends will be analyzed, market structures, consumer behavior, production costs, and international trade will be examined and the role of the US government in a laissez faire market economy will be analyzed. In addition, the impact of technological trends on businesses will be addressed. Based on the analysis, a comprehensive argument will be presented to support (government or Microsoft) position in the trial which was one of the biggest investigations of antitrust behavior since the turn of the century.