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Essay / The Pros and Cons of Antitrust Laws - 984
The Sherman Act prohibited competitors from entering into agreements that would limit competition. This law also made it illegal for a company to operate as a monopoly if that company does not compete. enough. The Sherman Act was successful in breaking up the trusts, but as American business practices began to change, companies found a new way to control prices and production. Rather than forming trusts, competitors would unite into a single company. This new strategy to control prices and production is called merger. Congress passed the Clayton Act in 1914 to combat this new business strategy. The Clayton Act helps protect consumers by prohibiting mergers that could significantly lessen competition. Also in 1914, Congress enacted the Federal Trade Commission Act (FTC), which created a federal agency to monitor markets and prevent unfair trade practices. The FTC has the authority to investigate and stop unfair competition strategies and deceptive practices. Even though these laws were passed a long time ago, they continue to protect consumers and the market.