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Antitrust

Antitrust

:Antitrust is also the name for a movie, see Antitrust (film) Antitrust or competition laws are laws which prohibit anti-competitive or unfair business practices. The term "antitrust" derives from the U.S. law which was originally formulated to combat "business trusts", now more commonly known as cartels.

Divisions

Most antitrust activity affects the following areas:
- Bid rigging
- Monopolization and oligopolization
- Price fixing
- Tying
- Vendor lock-in
- Business
- Competition
- Predatory pricing

History

Alabama became the first U.S. state to enact an antitrust law on February 23, 1883. The United States federal government passed the Sherman Antitrust Act in 1890, although it was not put to use for several more years. Several large conglomerates such as the Northern Securities Company, the Standard Oil company, and the American Tobacco Company were found to be illegal trusts, and broken up by the courts. More recently, large American companies AT&T and Microsoft have been sued by the U.S. government for antitrust violations. Most western countries have antitrust or competition laws of some form. The European Union has its own competition law.

Arguments in favor of antitrust laws

By introducing antitrust legislation, consumers should benefit from reduced prices, better product diversity, and thus more choice. Furthermore, as the market power of large cartels is reduced, they are forced to pay more attention to the needs and wishes of individual customers. Large companies with huge cash reserves and large lines of credit can stifle competition by engaging in predatory pricing; that is, by selling their products and services at a loss for a time, in order to force their smaller competitors out of business. With no competition, they are then free to consolidate control of the industry and charge whatever prices they wish. At this point, there is also little motivation for investing in further technological research, since there are no competitors left to gain an advantage over. High barriers to entry such as large upfront investment requirements in infrastructure and exclusive agreements with distributors, customers, and wholesalers ensure that it will be difficult for any new competitors to enter the market, and that if any do, the trust will have ample advance warning and time in which to either buy the competitor out, or engage in its own research and return to predatory pricing long enough to force the competitor out of business.

Criticisms of antitrust

Coercive monopolies are in a privileged position to reap economic benefits by restricting output and raising prices, without fear of competition. However, Thomas Woods asserts that the industries most frequently accused of holding a coercive monopoly position in the late nineteenth century were neither restricting output nor raising prices. The Results of "Predatory pricing": Commodity Prices from 1880-1890 During the 1880s output of monopolistic industries grew seven times faster than the overall economy, while prices in these industries were generally falling—even faster than the 7% rate of decline that occurred in the economy as a whole. Free market economist Milton Friedman states that he initially agreed with the underlying principles of antitrust laws (breaking up monopolies and oligopolies and promoting more competition), but came to the conclusion that they do more harm than good and that therefore they should not exist. Critics also argue that the empirical evidence shows that "predatory pricing" does not work in practice, and is better defeated by a truly free market than by anti-trust laws (see Criticism of the theory of predatory pricing). Thomas Sowell argues that even if a superior business drives out a competitor, it doesn't follow that competition has ended: :In short, the financial demise of a competitor is not the same as getting rid of competition. The courts have long paid lip service to the distinction that economists make between competition — a set of economic conditions — and existing competitors, though it is hard to see how much difference that has made in judicial decisions. Too often, it seems, if you have hurt competitors, then you have hurt competition, as far as the judges are concerned.[http://www.forbes.com/forbes/1999/0503/6309089a.html] Alan Greenspan argues that the very existence of antitrust laws discourages businessmen from being productive for society, out of fear that their business actions will be determined illegal and dismantled by government. In his essay entitled Antitrust, he says: "No one will ever know what new products, processes, machines, and cost-saving mergers failed to come into existence, killed by the Sherman Act before they were born. No one can ever compute the price that all of us have paid for that Act which, by inducing less effective use of capital, has kept our standard of living lower than would otherwise have been possible." [http://www.polyconomics.com/searchbase/06-12-98.html]

External links

Governmental

- [http://www.usdoj.gov/atr/ United States Department of Justice Antitrust Division homepage]
- [http://www.ftc.gov/ftc/antitrust.htm United States Federal Trade Commission: Antitrust and Competition division]
- [http://europa.eu.int/comm/competition/antitrust/ Official European Union Antitrust site]

Academic

- [http://www.cei.org/pdf/1615.pdf Antitrust Policy As Corporate Welfare by Clyde Wayne Crews Jr] "It is hoped that policymakers will come to recognize that government cannot protect the public from monopoly power, because it is the source of such power."
- [http://straylight.law.cornell.edu/topics/antitrust.html Cornell University review of antitrust law]
- [http://www.mises.org/journals/rae/pdf/rae6_2_3.pdf The Protectionist Roots of Antitrust by Donald J. Boudreaux and Thomas J. DiLorenzo] "antitrust was a protectionist institution from the very beginning; there never was a "golden age of antitrust" besieged by rampant cartelization"

Other

- [http://www.antitrustinstitute.org/ The American Antitrust Institute]
- [http://www.antitrust.de/ German antitrust law]
- [http://www.quebecoislibre.org/000219-13.htm Antitrust Laws Should Be Abolished] by Edward W. Younkins, 19 February 2000.
- [http://www.polyconomics.com/searchbase/06-12-98.html Criticism of Antitrust] by Alan Greenspan
- [http://www.ntu.org/main/press.php?PressID=344&org_name=NTUF Antitrust Law: Affirmative Action for Uncompetitive Businesses] by Mark Schmidt, National Taxpayers Union Foundation, Policy Paper 132, 11 Dec 2000.
- [http://www.abanet.org/antitrust/source/ The Antitrust Source], monthly analysis of antitrust issues by the American Bar Association
- [http://www.econlib.org/library/Enc/Antitrust.html Antitrust] by Fred S. McChesney - "The popular view that cartels and monopolies were rampant at the turn of the century now seems incorrect to most economists."

References

# Thomas E. Woods, Jr., Ph.D (2004). The Politically Incorrect Guide to American History, 99. # [http://www.cato.org/pubs/policy_report/v21n2/friedman.html The Business Community's Suicidal Impulse by Milton Friedman] A criticism of antitrust laws and cases by the Nobel economist Category:Business law Category:Commercial crimes ja:反トラスト法

Antitrust (film)

Antitrust is a 2001 film directed by Peter Howitt and written by Howard Franklin. The cast included Ryan Phillippe, Rachael Leigh Cook, Claire Forlani, Tim Robbins, Douglas McFerran, Richard Roundtree, Tygh Runyan, and Yee Jee Tso. The film is a thriller portraying young idealistic programmers working at startup companies and a big closed source company (NURV) which offers money, a playful working environment and creative opportunites to talented programmers if they are willing to work for them. The charismatic CEO of NURV seems at first to be good natured, but eventually the hero of the story starts to unravel the terrible hidden truth of NURV's operation.

Trivia

- Tim Robbins' CEO character appears to be based on Microsoft founder Bill Gates, while at the same time exhibiting some of the trademark characteristics of Apple founder Steve Jobs.
- Sun CEO Scott McNealy makes a cameo appearance.
- Miguel de Icaza makes a cameo appearance. Behind the scenes, Miguel assisted in designing the computer screenshots (in GNOME) used in the movie.
- Some see similarities between the plot of the film and the conspiracy theories involving the death of Dutch software developer Jan Sloot.
- Among the many computer programmers NURV spied on is a person wearing a noticeable red hat. This is an obvious reference to Red Hat in the software industry.

Memorable Quotes

Gary Winston: Are we making CHEMICAL WEAPONS? KIDDIE PORN? Are we STRIP MINING? No!!!! Why are they after me? Inspector: [looking for fingerprints on a keyboard] Dust the colon and the backslash key! Only geeks use those keys.

Sequel Rumors

Ever since Sony acquired MGM, there have been rumors stating that a sequel to Antitrust will be made (despite the fact that the movie failed and lost a lot of money). Knowing the heated rivalry between Sony and Microsoft, many people find it natural that an Antitrust sequel is inevitable. Some rumors even stated that the sequel will be set 8 years after the original wherein Gary Winston will be released from prison (on a legal technicality), return to NURV, rebuild his company and, with his intention on world domination, aggressively compete not only in the software business but also in video games (an obvious reference to Microsoft and its game consoles Xbox and Xbox 360) and digital music (possible reference to Apple's current domination with iPod). There is no confirmation however if the rumors are true or not, and stars Ryan Phillippe, Rachael Leigh Cooke and Tim Robbins so far did not express interest in a sequel to Antitrust.

External links

-
- [http://www.framingbusiness.net/antitrust.htm Antitrust and the Straw Man] - A Discussion of The Film and Open Source Category:2001 films

Law

:This article is about law in society. For other possible meanings, see law (disambiguation). Law (a loanword from Old Norse lag), in politics and jurisprudence, is a set of rules or norms of conduct which mandate, proscribe or permit specified relationships among people and organizations, provide methods for ensuring the impartial treatment of such people, and provide punishments of/for those who do not follow the established rules of conduct. Law is typically administered through a system of courts, in which judges hear disputes between parties and apply a set of rules in order to provide an outcome that is just and fair. The manner in which law is administered is known as a legal system, which typically has developed through tradition in each country. Legal practitioners, most often, must be professionally trained in the law before they are permitted to advocate for a party in a court of law, draft legal documents, or give legal advice.

Legal traditions

There are generally four broad legal traditions that are practiced in the world today.

Civil law

The Civilian system of law is a codified law that sets out a comprehensive system of rules that are applied and interpreted by judges. It is by and large the most commonly practiced system of law in the world, with almost 60 % of the world's population living in a country ruled on the civilian system. The most important difference to common law is that normally, only legislative enactments are considered to be legally binding, but not precedent cases. However, as a practical matter, courts normally follow their previous decisions. Furthermore, in some civil law systems (e.g. in Germany), the writings of legal scholars have considerable influence on the courts. In most jurisdictions the core areas of private law are codified in the form of a civil code, but in some, like Scotland it remains uncodified. The civil law system has its origins in Roman law, which was adopted by scholars and courts from the late middle ages onwards. Most modern systems go back to the 19th century codification movement. The civil codes of many, particularly Latin countries and former French and Spanish colonies closely trail the Code de Napoléon in some fashion. However, this is not true for most Central and Eastern European, Scandinavian and East Asian countries. Notably, the German BGB was developed from Roman law with reference to German legal tradition. The importance of the Code Napoléon should also not be overemphasized as it covers only the core areas of private law, while other codes and statutes govern fields such as corporate law, administrative law, tax law and constitutional law.

Common law

The Common law is an Anglo-Saxon legal tradition, based on unwritten laws developed through judicial decisions that create binding precedent. The common law system is currently in practice in Australia, Canada (excluding Quebec), United Kingdom, and the United States (excluding Louisiana). In addition to these countries several others have adapted the common law system into a mixed system. For example, India and Nigera operate largely on a common law system but incorporate a good deal of customary law and religious law.

Customary law

Customary law are systems of law that has evolved largely on their own within a given country and have been adapted to meet the needs of the particular culture. Note that customary law may also be relevant within jurisdictions following another legal tradition in fields or subfields of law where no legislative enactment exists. For example, in Austria, scholars of private law often claim that customary law continues to exist, whereas public law scholars dispute this claim. (In any case, it is hard to find any practically relevant examples.)

Religious law

Many countries base their system of law on religious tenants. The most dominant system of this form of law is Muslim law (or "Sharia") which is a codified law that is found within the Koran. These laws deal primarily with the personal rights and dispute resolution between individuals. It is used in some Middle Eastern nations; such as in the Iran and Saudi Arabia. On a smaller level there are still regions of the world that practice canon law, which is followed by Catholics and Anglicans, and a similar legal system is used by the Eastern Orthodox Church. The same can be said for Jewish law (halakha or halacha), which is followed by Orthodox and Conservative Jews, in substantially different forms.

Bodies of law

In the broadest sense, bodies of law can be subdivided on the basis of who the parties to an action are. It is frequent that practiced fields of law overlap into several of these bodies of law.

Private law

The area of private law in a legal system concerns law that oversees disputes between private individuals. This area is, to a large extent, the most comprehensive area of law, dealing with all non-criminal harm one person does to another.

Public law

The area of public law, in a general sense, is the law in a given legal system that concerns disputes between the government and private individuals residing within the country. The state can bring actions against people for criminal acts, as well as breach of regulatory laws. Equally, individuals can bring actions against the government for harm it has done. This includes grounds on the basis of a breach of regulations, legislate on matters beyond their competence, or violation of an individuals rights. These last two points are often protected under a countries’ constitution.

Procedural law

Procedural law concerns the areas of law that regulate how all actions are dealt with. This includes who can have access to the court system, how complaints are submitted, and what are the rights of the parties involved. Procedural law is often known as "adjective" law as it is the law that concern how other laws are to be applied. Typically, this is broadly covered by a government’s civil and criminal procedure rules. But equally this includes the law of evidence which determines what means are used to prove facts, as well as, the law regarding remedies.

International law

International law governs the relations between states, or between citizens of different states, or international organizations. Its two primary sources are customary law and treaties.

Philosophy of law

Philosophy of law is a branch of philosophy and jurisprudence which studies basic questions about law and legal systems, such as "what is the law?", "what are the criteria for legal validity?", "what is the relationship between law and morality?", and many other similar questions. In the western tradition there are several schools of thought on the philosophical basis of law. First, there is natural law, which attempts to describe law as an inherent quality in humans that is derived from natures. Second, there is the positivism which believes that law is a purely human-made construct that society uses to maintain social order. Third, there is legal realism which believes that law is an arbitrary set of rules that are largely established through the tastes and preferences of judges.

Anthropology of law

:See main discussion at Honour Law has an anthropological dimension. It has been recognized from Montesquieu to the present that law is shaped by the kind of society in which it is practised. One continuum into which various societies can be placed contrasts the "culture of law" with the "culture of honour". In order to have a culture of law, people must dwell in a society where a government exists whose authority is hard to evade and generally recognised as legitimate. People take their grievances before the government and its agents, who arbitrate disputes and enforce penalties. This behaviour is contrasted with the culture of honour, where respect for persons and groups stems from fear of the revenge they may exact if their person, property, or prerogatives are not respected. Cultures of law must be maintained. They can be eroded by declining respect for the law, achieved either by weak government unable to wield its authority, or by burdensome restrictions that attempt to forbid behaviour prevalent in the culture or in some subculture of the society. When a culture of law declines, there is a possibility that an culture of honor will arise in its place.
History

Practice of law
Practice of law is typically overseen by either a government organization or independent regulating body such as a bar association or barrister society. To practice law – i.e. appear in front of a judge on behalf of someone, draft legal documents, etc. – the practitioner must be certified by the regulating body. This usually entails a two or three year program at a university’s faculty of law or a law school, followed by an entrance examination (eg. bar admissions). Once accredited, a legal practitioners will often work in law firm, as well as in government, a private corporation, or even work as sole practitioner. A significant component to the practice of law in the common law tradition involves legal research in order to determine the current state of the law. This usually entails exploring case reporters, legal periodicals, and legislation.
See also

- Law topics overview
- List of areas of law
- List of legal topics
- List of legal terms
- List of jurists
- List of legal abbreviations
- List of case law lists
- List of law firms
Further reading

- Cheyenne Way: Conflict & Case Law in Primitive Jurisprudence, Karl N. Llewellyn and E. Adamson Hoebel, University of Oklahoma Press, 1983, trade paperback, 374 pages, ISBN 0806118555
- The Bilingual LSP Dictionary. Principles and Practice for Legal language, Sandro Nielsen, Gunter Narr Verlag 1994.
- [http://browse.addall.com/Browse/Author/2088479-1 Other books by Karl N. Llewellyn]
- David, René, and John E. C. Brierley. Major Legal Systems in the World Today: An Introduction to the Comparative Study of Law. 3d ed. London: Stevens, 1985 (ISBN 0420473408).
External links

- [http://www.legalmatch.com LegalMatch] Legal Resource
- [http://ausicl.com The Australian Institute of Comparative Legal Systems]
- [http://www.lpig.org Law and Policy Institutions]
- [http://www.llbee.com/news.php?p=news Laws External Education- Legal News By Subject]
- [http://www.4lawschool.com 4LawSchool- Legal Reference]
- [http://ww3.definitions-legal.com:8567/ Law, Legal Definitions & Reference]
- [http://www.ericdigests.org/1996-3/law.htm Essentials of Law-Related Education. ERIC Digest.]
- [http://www.law.cornell.edu LII - Topical overviews, US Supreme Court decisions, US Code (Acts of Congress)]
- [http://www.worldlii.org WorldLII - The World Legal Information Institute]
- [http://www.lawmoose.com LawMoose Legal Reference Library]
- [http://legallinks.jenkinslaw.org Legal Research Links]
- [http://www.findlaw.com FindLaw]
- [http://ausicl.com The Australian Institute of Comparative Legal Systems]
- [http://www.nolo.com/glossary.cfm Everybody's Legal Glossary] - From Nolo
- [http://www.alllaw.com/ AllLaw]
- [http://legal.wikicities.com/ WikiCities Legal Site]
- Stanford Encyclopedia of Philosophy:
- [http://plato.stanford.edu/entries/law-ideology/ Law and Ideology]
- [http://plato.stanford.edu/entries/law-language/ Law and Language]
- [http://en.jurispedia.org/ The shared law] in Jurispedia
- [http://www.avocatura.com Romanian Law]
- [http://www.thedailylaw.com Daily Law news]
- [http://members.fortunecity.com/victorcauchi/lex/lexindex.htm Laws of Malta] Chapter summaries and a general Glossary of definitions.
- [http://LawyerIntl.com LawyerIntl.com] Legal Resource and Law Dictionary
- [http://LawGuru.com LawGuru.com] Legal Portal
- [http://forumprawne.org Prawo i porady prawne] - web discussion board about Polish law Category:Core issues in ethics ja:法 (法学) simple:Law th:กฎหมาย

Law of the United States

The law of the United States is derived from the common law of the United Kingdom, which was in force at the time of the Revolutionary War. However, the supreme law of the land in the United States is the United States Constitution and, per the Constitution, treaties to which the U.S. is a party. These form the basis for federal laws under the federal constitution in the United States, circumscribing the boundaries of the jurisdiction of federal law and the laws in the fifty U.S. states and territories.

American common law

Although the U.S. and most Commonwealth nations are heirs to the common law legal tradition, American law tends to be unique in many ways. This is because the American legal system was severed from the British system by the Revolution, and afterwards, it evolved independently from the British Commonwealth legal systems. Therefore, when attempting to trace the development of traditional judge-made common law principles (that is, the few that have not already been overridden by newer laws), American courts will look at British cases only up to the early 19th century. Although the courts of the various Commonwealth nations are often influenced by each other's rulings, American courts rarely follow post-Revolution Commonwealth rulings unless there is no American ruling on point, the facts and law at issue are nearly identical, and the reasoning is strongly persuasive. The earliest American cases, even after the Revolution, often did cite contemporary British cases, but such citations gradually disappeared during the 19th century as American courts developed their own principles to resolve the legal problems of the American people. Today, the vast majority of American legal citations are to domestic cases. Sometimes, courts (and casebook editors) do make exceptions for opinions on issues of first impression by brilliant British jurists, like Lord Denning. Some adherents of originalism and strict constructionism (e.g., Antonin Scalia) argue that American courts should never look for guidance to post-Revolution cases from legal systems outside of the United States (regardless of whether the reasoning is persuasive), with the sole exception of cases interpreting international treaties to which the U.S. is a signatory.

Federal law

Federal law in the United States originates with the Constitution, which gives Congress the power to enact statutes for certain limited purposes like regulating commerce. Nearly all statutes have been codified in the United States Code. Many statutes give executive branch agencies the power to create regulations, which are published in the Code of Federal Regulations and also carry the force of law. Many lawsuits turn on the meaning of a federal statute or regulation, and judicial interpretations of such meaning carry legal force under the principle of stare decisis.

State law

As for state law in the United States, American states are separate sovereigns with their own constitutions and retain plenary power to make laws covering anything not preempted by the federal Constitution or federal statutes. Nearly all states started with the same British common law base, but the passage of time has resulted in enormous diversity in the laws of the fifty states. Over time, state courts expanded the old common law rules in different directions (through their traditional power to make law under stare decisis), and state legislatures passed various statutes expanding or overriding such judge-made rules. Unlike other common law jurisdictions, all American states have codified some or all of their statutory law into legal codes (an idea borrowed from the civil law through the efforts of American lawyer David Dudley Field). New York's codes are known as "Laws." California and Texas simply call them "Codes." Most other states use "Revised Statutes," "Compiled Statutes," or some other name for their codes. California, New York, and Texas have separate subject-specific codes, while all other states and the federal government use a single code divided into numbered titles. In some states, codification is often treated as a mere restatement of the common law. Judges are free to liberally interpret the codes unless and until their interpretations are specifically overridden by the legislature. In other states, there is a tradition of strict adherence to the plain text of the codes. The advantage of codification is that once the state legislature becomes accustomed to writing new laws as amendments to an existing code, then the code will usually always reflect what the current law is. In contrast, in jurisdictions with uncodified statutes, like the United Kingdom, it is much harder to determine what the current law is. One has to trace back to the earliest relevant Act of Parliament, and then identify all future Acts that purport to amend the earlier Act or which directly override it. For example, when the UK decided to create a Supreme Court of the United Kingdom, it had to identify every single Act referring to the House of Lords that was still good law, and then amend all of them to refer to the Supreme Court. [http://www.opsi.gov.uk/acts/acts2005/50004-aa.htm#sch9]

Criminal law

In the arena of criminal law, states have somewhat similar laws in regard to "higher crimes," such as murder and rape. However, for public welfare offenses where the state is punishing merely risky (as opposed to injurious) behavior, there is significant diversity across the various states. For example, the laws controlling drunk driving were rather unstandardized prior to the 1990s.

Tort law

American tort law tends to vary widely across the states. For example, a few jurisdictions allow actions for negligent infliction of emotional distress even in the absence of physical injury, but most do not. With practically any tort, there is a "majority rule" adhered to by most states, and one or more "minority rules." See United States tort law for more information.

Attempts at "uniform" laws

Efforts by various organizations at creating "uniform" state laws have been only partially successful. The two leading organizations are the American Law Institute (ALI) and the National Conference of Commissioners on Uniform State Laws (NCCUSL). The most successful and influential uniform laws are the Uniform Commercial Code (a joint ALI-NCCUSL project) and the Model Penal Code (from ALI). Apart from model codes, the American Law Institute has also created Restatements of the Law which are widely used by lawyers and judges as substitutes for long, tedious citations of old cases (in order to invoke the long-established principles contained in those cases).

Local law

States have delegated lawmaking powers to a staggering number of agencies, counties, cities, and special districts. And all the state constitutions, statutes and regulations are subject to judicial interpretation like their federal counterparts. Thus, at any given time, the average American citizen is subject to the rules and regulations of several dozen different agencies at the federal, state, and local levels, depending upon one's current location and behavior.

Odd exceptions

Unlike the rest of the country, state law in Louisiana is based on the Napoleonic Code, inherited from its time as a French colony. Puerto Rico is also a civil law jurisdiction. However, the criminal law of both jurisdictions has been necessarily modified by common law influences and the supremacy of the federal Constitution. California is a common law jurisdiction with a few features borrowed from the civil law. Besides the codification noted above, it has a community property system for the property of married persons. Also, the California Civil Code shows civil law influences in that the law of contracts is treated as part of the law of obligations (though the rules actually codified are clearly derived from the common law).

External links

- [http://www.findlaw.com/casecode/ Texts of US federal laws and US state laws]

Trust

Trust may refer to:
- Trust (sociology), the willing acceptance of one person's power to affect another ;Property law:
- Ownership and management of property by one on behalf of another:
- Trust (Law) USA
- Trust (Law) non-USA
- Escrow, where a thing is held in trust until conditions are fullfilled ;Finance:
- Trust company, a financial institution offering banking, investment and estate administration services
- Trust (19th century), an entity used in the late 19th century with intent to create a monopoly
- Investment trust, a company that invests in other companies or properties
- Income trust
- Royalty trust
- Real estate investment trust ;Computer science:
- Trusted system, a system where there is no choice but to trust
- Web of trust, a system to establish authenticity
- A trust metric rates users of social software ;Music:
- Trust (band), was a French hard rock band, rose to fame around 1980
- Trust (album), 1981, by Elvis Costello
- Trust (2002 album), by Low (band)
- Trust Company (band), better known as TRUSTcompany or TRUST
- CO, is an American grunge band that started in the early 2000s

Bid rigging

Bid Rigging is an illegal agreement between two competitors. It is a form of price fixing, and involves an agreement in which one party of a group of bidders will win the bid. It is often practiced where contracts are determined by bid, for example with government construction contracts. There are some very common bid rigging practices:
- Subcontract bid rigging is where some of the bidders opt out under the agreement that some parts of the bid will be subcontracted to them.
- Bid suppression is where some of the bidders opt out of the bid.
- Complementary bidding is where some of the bidders bid an amount knowing that it is too high or with unacceptable conditions.
- Bid rotation is where the bidders take turns winning the bid, for example each party winning an equal number of hours of work.

External links

[http://www.usdoj.gov/atr/public/guidelines/pfbrprimer.pdf U.S. Department of Justice Primer] Category:Pricing Category:Commercial crimes Category:Anti-competitive behaviour

Oligopoly

An oligopoly is market form in which a market is dominated by a small number of sellers (oligopolists). The word is derived from the Greek for few sellers. Because there are few participants in this type of market, each oligopolist is aware of the actions of the others. Oligopolistic markets are characterised by interactivity. The decisions of one firm influence, and are influenced by, the decisions of other firms. Strategic planning by oligopolists always involves taking into account the likely responses of the other market participants. An oligopy is a form of economy. As a quantitative description of oligopoly, the four-firm concentration ratio is often utilized. This measure expresses the market share of the four largest firms in an industry as a percentage. Using this measure, an oligopoly is defined as a market in which the four-firm concentration ratio is above 40%. An example would be the supermarket industry in the United Kingdom, with a four-firm concentration ratio of over 70% and the brewery industry also in the U.K has a four firm concentration ratio of a staggering 85%. In an oligopoly, firms operate under imperfect competition, the demand curve is kinked to reflect inelasticity below market price and elasticity above market price, the product or service firms offer are differentiated and barriers to entry are strong. Following from the fierce price competitiveness created by this sticky-upward demand curve, firms utilize non-price competition in order to accrue greater revenue and market share. Oligopsony is a market form in which the number of buyers are small while the number of sellers in theory could be large. This typically happens in market for inputs where a small number of firms are competing to obtain factors of production. This also involves strategic interactions but of a different nature than when competing in the output market to sell a final output. Oligopoly refers to the market for output while oligopsony refers to the market where these firms are the buyers and not sellers (eg. a factor market). A market with a few sellers (oligopoly) and a few buyers (oligopsony) is referred to as a bilateral oligopoly. The terms monopoly (one seller), monopsony (one buyer), and bilateral monopoly have a similar relationship. In industrialized countries oligopolies are found in many sectors of the economy, such as cars, consumer goods, and steel production. Unprecedented levels of competition, fueled by increasing globalisation, have resulted in the emergence of oligopsony in many market sectors, such as the aerospace industry. There are now only a small number of manufacturers of civil passenger aircraft. A further instance arises in a heavily regulated market such as wireless communications. Typically the state will license only two or three providers of cellular phone services. Oligopolistic competition can give rise to a wide range of different outcomes. In some situations, the firms may collude to raise prices and restrict production in the same way as a monopoly. Where there is a formal agreement for such collusion, this is known as a cartel. Firms often collude in an attempt to stabilise unstable markets, so as to reduce the risks inherent in these markets for investment and product development. There are legal restrictions on such collusion in most countries. There does not have to be a formal agreement for collusion to take place (although for the act to be illegal there must be a real communication between companies) - for example, in some industries, there may be an acknowledged market leader which informally sets prices to which other producers respond, known as price leadership. In other situations, competition between sellers in an oligopoly can be fierce, with relatively low prices and high production. This could lead to an efficient outcome approaching perfect competition. Desoligopolization is the disappearance of an oligopoly. Oligopoly theory makes heavy use of game theory to model the behaviour of oligopolies:
- Stackelberg's duopoly. In this model the firms move sequentially (see Stackelberg competition).
- Cournot's duopoly. In this model the firms simultaneously choose quantities (see Cournot competition).
- Bertrand's oligopoly. In this model the firms simultaneously choose prices (see Bertrand competition).
- Monopolistic competition. In this mod Category:Market forms

Tying

Tying is the practice of making the sale of one good (the tying good) to the de facto or de jure customer conditional on the purchase of a second distinctive good (the tied good). Tying is normally regarded as an anti-competitive practice as it is implied in this that one or more components of the package are sold individually by other businesses as their primary product, and thereby this bundling of goods would hurt their business. It is also implied that the company doing this bundling has a significantly large market share so that it would hurt the other companies who sell only single components. Tying is often used when the supplier makes one product that is critical to many customers. By threatening to withhold that key product unless others are also purchased, the supplier can increase sales of less necessary products. Horizontal tying is the practice of requiring customers to pay for an unrelated product or service together with the desired one. For example, all of one company's toothbrushes come with the company's ice skates. Vertical tying is the practice of requiring customers to purchase related products or services from the same company. For example, a company's automobile only runs on its own proprietary gas and can only be serviced by its own dealers. In an effort to curb this, many jurisdictions require that warranties not be voided by outside servicing; for example see the Magnuson-Moss Warranty Act in the United States. More recently, video game consoles run only software licensed by the console manufacturer and use lockout chips to enforce this. Microsoft ties together Microsoft Windows, Internet Explorer, and Outlook Express. Tying may be the action of several companies, as well as the work of just one firm. It was first made potentially illegal in the United States by the Sherman Antitrust Act (section 1) if the firm has market power in the tying good, and a "non-trivial" amount of business is affected by the tying. See International Salt Co. v. United States, 332 U.S. 392 (1947).

Vendor lock-in

In economics, vendor lock-in, also known as proprietary lock-in, lock-in, or the Pottersville pattern, is a situation in which a customer is dependent on a vendor for products and services and cannot move to another vendor without substantial switching costs, real and/or perceived. By the creation of these costs to the customer, lock-in favors the company (vendor) at the expense of the consumer. Lock-in costs may create a barrier to entry in a market that if great enough to result in an effective monopoly, may result in antitrust actions from the relevant authorities (the FTC in the US). Vendor lock-in is often used in the computer industry to describe the effects of a lack of compatibility between different systems. Different companies, or a single company, may create different versions of the same system architecture that cannot interoperate. Manufacturers may design their products so that replacement parts or add-on enhancements must be purchased from the same manufacturer, rather than from a third party (connector conspiracy). The purpose is to make it difficult for users to switch to competing systems. Examples include the several slightly different implementations of various open standards, the many variations of Unix, Microsoft Office's file formats, and also Microsoft's software in general. This approach is not limited to the computer industry, however. For example, as of 2004 Sony digital cameras typically use add-in memory that can only be acquired from Sony, and this memory is typically much more expensive than alternatives available from multiple sources. Vendor lock-in for higher-end cameras takes the form of incompatible systems of lens mountings: a photographer who has purchased lens and other equipment from one manufacturer may find switching to a rival brand prohibitively expensive. Lock-in may eventually also be damaging to the company or industry in question. In the Unix wars, various Unix vendors battled so hard to lock their customers into their version of Unix that the entire Unix market was seriously affected. Sun Microsystems' unwillingness to open Java to external standardization bodies and the lack of multiple competing Java runtime implementations is widely held to be the reason Java has failed on the desktop. One way to create artificial lock-in for items without it is to create loyalty schemes. For example, frequent flyer miles that can only be used with one airline create a perceived cost of switching airlines, as do supermarket "discount" cards.

The Microsoft example

Microsoft software carries a high level of vendor lock-in, based on its extensive set of proprietary APIs. The European Commission, in its [http://europa.eu.int/comm/competition/antitrust/cases/decisions/37792/en.pdf March 24, 2004 decision] on Microsoft's business practices, quotes, in paragraph 463, Microsoft general manager for C++ development Aaron Contorer as stating in a February 21, 1997 internal Microsoft memo drafted for Bill Gates: :"The Windows API is so broad, so deep, and so functional that most ISVs would be crazy not to use it. And it is so deeply embedded in the source code of many Windows apps that there is a huge switching cost to using a different operating system instead... :"It is this switching cost that has given the customers the patience to stick with Windows through all our mistakes, our buggy drivers, our high TCO, our lack of a sexy vision at times, and many other difficulties [...] Customers constantly evaluate other desktop platforms, [but] it would be so much work to move over that they hope we just improve Windows rather than force them to move. :"In short, without this exclusive franchise called the Windows API, we would have been dead a long time ago."

Combating vendor lock-in

In the 1980s and 1990s, public, royalty-free standards were hailed as the best solution to vendor lock-in. The weakness of such standards was that if one software vendor achieved a dominant market share, "embrace, extend and extinguish" (EEE) tactics could be used to obsolete the standard. Since the late nineties, the use of free/open source software (FOSS) has been pushed as a stronger solution. Because FOSS software can be modified and distributed by anyone, the availability of functionality cannot tie a user to one distributor. Also, FOSS tends to cling to standards. The ineffectiveness of distributor lock-in means there's no incentive for FOSS developers to invent new data formats if usable (royalty-free) standards exist. In particular, copylefted FOSS is particularly resistant to the above mentioned "EEE" tactics since anyone distributing modified versions must also distribute the source code to their modifications. As of 2004, IBM is promoting and contributing to the development of certain FOSS projects to weaken the market dominance of competitors such as Microsoft. This is interesting, not only because IBM was once one of the biggest users of the vendor lock-in tactic, but also because IBM is simultaneously funding and promoting software patentability and "trusted computing", the two biggest impediments to FOSS development.

References

- Arthur, W. B. 1989. Competing technologies, increasing returns, and lock-in by historical events. Economic Journal 97: 642-65.
- David, P. A. 1985. Clio and the economics of QWERTY. American Economic Review 75: 332-7.
- [http://www.utdallas.edu/~liebowit/paths.html Liebowitz, S. J. and Margolis, S. E. 1995. Path dependence, lock-in and history," Journal of Law, Economics, and Organization 11: 205-226.]
- [http://www.utdallas.edu/~liebowit/palgrave/palpd.html Liebowitz and Margolis "Path Dependence" entry in The New Palgraves Dictionary of Economics and the Law, MacMillan, 1998.]
- [http://wwwpub.utdallas.edu/~liebowit/keys1.html The Fable of the Keys, Liebowitz, S. J. and Margolis, S. E. 1990 Journal of Law and Economics 22: 1-26.]

External links

- [http://www.antipatterns.com/vendorlockin.htm Vendor Lock-In (AntiPattern)], which provides examples and notes alternative names such as "Pottersville". Category:Manufacturing Category:Anti-competitive behaviour Category:Anti-patterns Category:Marketing strategies and paradigms category:Strategic management

Competition

Competition is the act of striving against another force for the purpose of achieving dominance or attaining a reward or goal, or out of a biological imperative such as survival. Competition is a term widely used in several fields, including biochemistry, ecology, economics, business, politics, and sports. Competition may be between two or more forces, life forms, agents, systems, individuals, or groups, depending on the context in which the term is used. Competition may yield various results to the participants, including both intrinsic and extrinsic rewards. Some, such as survival advantages, including favorable territory, are intrinsic biological factors that occur as a result of ecological competition between organisms. Others, such as business dominance and political power, involve competition between humans. In addition, extrinsic symbols, such as trophies, plaques, ribbons, prizes, or laudations, may be given to the winner(s). Such symbolic rewards are commonly used wherever the rewards inherent in the competition are primarily intrinsic, such as at human sporting and academic competitions. In general, the rewards range widely but usually help reinforce the advantage that one participant has over the other participant(s).

Sizes and levels of competition

Competition may also exist at different sizes; some competitions may be between two members of a species, while other competitions can involve entire species. In an example in economics, a competition between two local stores would be considered small compared to competition between several mega-giants. As a result, the consequences of the competition would also vary- the larger the competition, the larger the effect. In addition, the level of competition can also vary. At some levels, competition can be informal and be more for pride or fun. However, other competitions can be extreme and bitter; for example, some human wars have erupted because of the intense competition between two nations or nationalities.

Consequences of competition

nationalities Competition can result in both beneficial and detrimental results. For example, inter-species competition, including between humans, is the driving force of adaptation and ultimately, evolution. Social darwinists claim that competition also serves as a mechanism for determining the best-suited group, politically, economically, and ecologically, however this belief is very questionable. However, competition can also have negative consequences, particularly on the human species. Potential detrimental effects include the injury of other organisms and the drain of valuable resources and energy for competition. In addition, human competition may also require large amounts of money (such as in political elections, international sports competitions, and advertising wars) and can also lead to the compromising of ethical standards in order to gain an advantage in the competition. For example, several athletes have been caught using banned steroids in professional sports in order to boost their own chances of success or victory. Finally, competitive striving can also be harmful for the participants. Examples include athletes that injure themselves because they exceed the physical tolerances of their bodies, and companies that pursue unprofitable paths while engaging in competitive rivalries.

Competition in different fields

Economics and business competition

Seen as the pillar of capitalism in that it may stimulate innovation, encourage efficiency, or drive down prices, competition is touted as the foundation upon which capitalism is justified. According to microeconomic theory, no system of resource allocation is more efficient than pure competition. Competition, according to the theory, causes commercial firms to develop new products, services, and technologies. This gives consumers greater selection and better products. The greater selection typically causes lower prices for the products compared to what the price would be if there was no competition (monopoly) or little competition (oligopoly). However, competition may also lead to wasted (duplicated) effort and to increased costs (and prices) in some circumstances. Similarly, the psychological effects of competition may result in harm as well as good. Three levels of economic competition have been classified. The most narrow form is direct competition (also called category competition or brand competition), where products that perform the same function compete against each other. For example, a brand of pick-up trucks competes with several different brands of pick-up trucks. Sometimes two companies are rivals and one adds new products to their line so that each company distributes the same thing and they compete. The next form is substitute competition, where products that are close substitutes for one another compete. For example, butter competes with margarine, mayonnaise, and other various sauces and spreads. The broadest form of competition is typically called budget competition. Included in this category is anything that the consumer might want to spend their available money on. For example, a family that has $20,000 available may choose to spend it on many different items, which can all be seen as competing with each other for the family's available money. Competition does not necessarily have to be between companies. For example, business writers sometimes refer to "internal competition". This is competition within companies. The idea was first introduced by Alfred Sloan at General Motors in the 1920s. Sloan deliberately created areas of overlap between divisions of the company so that each division would be competing with the other divisions. For example, the Chevy division would compete with the Pontiac division for some market segments. Also, in 1931, Proctor and Gamble initiated a deliberate system of internal brand versus brand rivalry. The company was organized around different brands, with each brand allocated resources, including a dedicated group of employees willing to champion the brand. Each brand manager was given responsibility for the success or failure of the brand and was compensated accordingly. This form of competition thus pitted a brand against another brand. Finally, most businesses also encourage competition between individual employees. An example of this is a contest between sales representatives. The sales representative with the highest sales (or the best improvement in sales) over the a period of time would gain benefits from the employer. It should also be noted that business and economical competition in most countries is often limited or restricted. Competition often is subject to legal restrictions, which usually provide for fair and equal business competition. Such laws may include the banning of monopolies and price gouging. Depending on the respective economic policy, the pure competition is to a greater or lesser extent regulated by competition policy and competition law. Competition between countries is quite subtle to detect, but is quite evident in the World economy, where countries like the US, Japan, the European Union and the East Asian Tigers each try to outdo the other in the quest for economic supremacy in the global market, harkening to the concept of Kiasuism.Such competition is evident by the policies undertaken by these countries to educate the future workforce. For example, East Asian economies like Singapore, Japan and South Korea tend to emphasize education by allocating a large portion of the budget to this sector, and by implementing programmes such as gifted education, which some detractors criticise as indicative of academic elitism.

Competition in biology and ecology

Competition is also present in biology, and more specifically, ecology. Competition between members of a species is the driving force of evolution and natural selection- the competition for resources, such as food, water, territory, and sunlight, results in the ultimate survival and dominance of the variation of the species best suited for survival. According to Darwin's Theory of Evolution, this intraspecies competition results in the organisms best suited for survival producing the most offspring. As a result, the species would evolve over time and adapt to the environment in which the organisms lived. Competition is also present between species. First, a limited amount of resources are available, and several species may depend on these resources. Thus, each of the species competes with the others to gain the resources. As a result, several species less suited to compete for the resources may either adapt or die out. In addition, competition is also prominent in predator-prey relationships. Both the predator and prey are competing against one another for survival; the predator is seeking food, and the prey is seeking to survive.

Competition in politics

Competition is also found in politics. In democracies, an election is a competition for an elected office. In other words, two or more candidates strive and compete against one another to attain a position of power. The winner gains the seat of the elected office for a set amount of time, when another election is usually held to determine the next holder of the office. In addition, there is inevitable competition inside a government. Because several offices are appointed, potential candidates compete against the others in order to gain the particular office. Departments may also compete for a limited amount of resources, such as for funding. Finally, where there are party systems, elected leaders of different parties will ultimately compete against the other party for laws, funding, and power. Finally, competition is also imminent between governments. Each country or nationality struggles for world dominance, power, or military strength. For example, the United States competed against the Soviet Union in the Cold War for world power, and the two also struggled over the different types of government (in this case, representative democracy and communism). The result of this type of competition often leads to worldwide tensions and may sometimes erupt into warfare.

Sports competition

While some sports, such as fishing, have been viewed as primarily recreational, most sports are considered competitive. The majority involve the competition between two or more persons, (or animals and/or mechanical devices typically controlled by humans as in horse racing or auto racing). For example, in a game of basketball, two teams compete against one another to determine who can score the most points. While there is no set reward for the winning team, many players gain an internal sense of pride. In addition, extrinsic rewards may also be given. Athletes, besides competing against other humans, also compete against nature in sports such as kayaking or mountain climbing, where the goal is to reach a destination, with only natural barriers impeding the process. While professional sports have been usually viewed as intense and extremely competitive, recreational sports, which are often less intense, are considered a healthy option for the competitive urges in humans. Sport provides a relatively safe venue for converting unbridled competition into harmless competition, because sports competition is not unrestrained. On the contrary, the competitions are governed by codified rules ageed upon by the participants. Violating these rules is considered to be unfair competition. Sports, in addition, is also considered artificial and not natural competition; for example, competing for control of a ball or defending territory on a playing field is not an innate biologal factor in humans. Athletes in sports like gymnastics and competitive diving actually compete against a conceptual ideal of a perfect performance, which incorporates measurable criteria and standards that are translated into numerical ratings and scores. Sports competition is generally broken down into three categories: individual sports, such as archery, dual sports, such as doubles tennis, or team sports competition, such as soccer. While most sports competitions are recreation, there exists several major and minor professional sports leagues throughout the world, and the Olympic Games, held every four years, is a pinnacle of sports competition.

Competition in education

Competition is also very evident in education. On a global scale, national education systems, intending to bring out the best in the next generation, encourage competitiveness among students by scholarships. Countries like Singapore and the United Kingdom have a gifted education programme which caters to gifted students, prompting charges of academic elitism. Upon receipt of their academic results, students tend to compare their grades to see who is better. For severe cases, the pressure to perform in some countries is so high that it results in stigmatisation of intellectually deficient students or even suicide as consequence of failing the exams, Japan being a prime example (see Education in Japan). This resulted in critical revaluation of examinations as a whole by educationists (see Exam). Competitions also make up a large proponent of extracurricular activities that students partake in. Such competitions include TVO's broadcasted Reach for the Top competition, FIRST Robotics and the University of Toronto Space Design Contest.

The study of competition

Competition has been studied in several fields, including psychology, sociology, and anthropology. Social psychologists, for instance, study the nature of competition. They investigate the natural urge of competition and its circumstances. They also study group dynamics to detect how competition emerges and what its effects are. Sociologists, meanwhile, study the effects of competition on society as a whole. In addition, anthropologists study the history and prehistory of competition in various cultures. They also investigate how competition manifested itself in various cultural settings in the past, and how competition has developed over time.

Competitiveness

Many philosophers and psychologists have identified a trait in most living organisms that drive the particular organism to compete. This trait, called competitiveness, is viewed as an innate biological trait that coexists along with the urge for survival. Competitiveness, or the inclination to compete, though, has become synonymous with aggressiveness and ambitiousness in the English language.

Predatory pricing

Predatory pricing is the practice of a dominant firm selling a product at a loss in order to drive some or all competitors out of the market, or create a barrier to entry into the market for potential new competitors. The other firms must lower their prices in order to compete with the predatory pricer, which causes them to lose money, eventually driving them bankrupt. The predatory pricer then has fewer competitors or even a monopoly, allowing them to raise their prices above what the market would otherwise bear. In many countries, including the United States, predatory pricing is considered an anti-competitive practice and is illegal under antitrust laws. However, it is usually difficult to prove that a drop in prices is due to predatory pricing rather than normal competition.

Criticism of the theory of predatory pricing

Some economists claim that true predatory pricing is rare because it is an irrational practice, and laws designed to stem the practice only inhibit competition. This stance was taken by the US Supreme Court in the 1993 case Brooke Group v. Brown & Williamson Tobacco, and the FTC has not successfully prosecuted any company for predatory pricing since. Proponents of the theory that predatory pricing is irrational point to the fact that it must be a larger firm that engages in the practice, in order to be able to withstand the losses longer than its competitors. However, a larger firm will lose more money when it drops its prices below cost, because it has a larger market share with which to begin. Furthermore, it will not be able to recoup these losses because when it raises its prices to high levels, it provides a strong incentive for another firm to re-open the market and undercut it. In addition, the competitors of a firm that engages in predatory pricing know that the predatory pricer cannot keep down their prices forever, and thus they must only play chicken in order to remain in the market. Thomas Sowell explains why predatory pricing is unlikely to work: :Obviously, predatory pricing pays off only if the surviving predator can then raise prices enough to recover the previous losses, making enough extra profit thereafter to justify the risks. These risks are not small. :The most obvious risk is that the targeted competitor will survive, leaving the would-be predator with nothing but red ink for his trouble. :However, even the demise of a competitor does not leave the survivor home free. Bankruptcy does not by itself destroy the fallen competitor's physical plant or the people whose skills made it a viable business.[http://www.forbes.com/forbes/1999/0503/6309089a.html] Critics of the predatory pricing theory support their case empirically by arguing that there has been no instance where such a practice has led to a monopoly. Conversely, they argue that there is much evidence that predatory pricing has failed miserably. For example, Dow not only found a cheaper way to produce bromine, but he defeated a predatory pricing attempt by a government-supported German cartel who objected to his selling in Germany at a lower price. The cartel retaliated by flooding the US market with below-cost bromine, at an even lower price than Dow's. But Dow simply instructed his agents to buy up at the very low price, then sell it back in Germany at a profit but still lower than the cartel's price. In the end, the cartel could not keep up selling below cost, and had to give in. This is used as evidence that the free market is a better way to stop predatory pricing than government regulation such as anti-trust laws.[http://fee.org/vnews.php?nid=4028] Thomas Sowell argues: :It is a commentary on the development of antitrust law that the accused must defend himself, not against actual evidence of wrongdoing, but against a theory which predicts wrongdoing in the future. It is the civil equivalent of "preventive detention" in criminal cases — punishment without proof.[http://www.forbes.com/forbes/1999/0503/6309089a.html]

Support for the theory of predatory pricing

Since the early 1980s, economic models based on game theory and the theory of imperfect information have suggested that predatory pricing can be rational and profitable under certain circumstances. For instance, by increasing production and lowering costs below price, a firm may convince its competitors that it has a lower cost of production than them, causing them to leave the market based on the conclusion that it would not be profitable for them to compete; this is known as low-cost signalling. Also, by pricing aggressively the incumbent firm will acquire a reputation for being "tough", this may deter potential entrants in the future. Another explanation for predatory pricing may be where long term success will require a large market share from early on (e.g. market for computer operating systems), usually markets with significant switching costs. By pricing aggressively to start with, even pricing below cost, firms can ensure a base of customers in the future from whom to make a profit. However, to date, no empirical example has yet been demonstrated of successful predatory pricing practice by a corporation.

External links

- Australian Competition and Consumer Commission page on predatory pricing: http://www.accc.gov.au/content/index.phtml/itemId/322986
- The Myth of Predatory Pricing: http://www.cato.org/pubs/pas/pa-169es.html
- Predatory Pricing, a New Theory: http://econserv2.bess.tcd.ie/SER/1999/essay02.html
- Patrick Bolton, Princeton University (see paper "Predatory Pricing: Strategic Theory and Legal Policy"): http://www.princeton.edu/~pbolton/
- Predatory Pricing and State Below-cost Sales Statutes in the United States: An Analysis: http://cb-bc.gc.ca/epic/internet/incb-bc.nsf/vwGeneratedInterE/ct01491e.html
- [http://fee.org/publications/the-freeman/article.asp?aid=3377 Features: Herbert Dow and Predatory Pricing]

Reference

- Luis M. B. Cabral: Introduction to Industrial Organisation, Massachusetts Institute of Technology Press, 2000, page 269. Category:Anti-competitive behaviour

U.S. state

A U.S. state is any one of the fifty states (four of which officially favor the term commonwealth) which, together with the District of Columbia and Palmyra Atoll (an uninhabited incorporated unorganized territory), form the United States of America. The separate state governments and the U.S. federal government share sovereignty, in that an "American" is a citizen both of the federal entity and of his or her state of residence. The United States Constitution allocates power between the two levels of government in general terms; the general idea is that by ratifying the Constitution, each state has transferred certain aspects of its sovereign powers to the federal government while retaining the remainder for itself. The tasks of education, health, transportation, and other infrastructure are generally the responsibility of the states. Over time, the Constitution has been amended, and the interpretation and application of its provisions have changed. The general tendency has been toward centralization, with the federal government playing a much larger role than it once did.

Legal relationship

At the time of the Declaration of Independence from Great Britain in 1776, the 13 colonies became 13 independently sovereign states, which became fourteen in 1777 with the formation of the Vermont Republic; for a brief period, they were in effect legally separate nations. But upon the adoption of the Articles of Confederation and Perpetual Union, the states became a single sovereign political entity as defined by international law, empowered to levy war and to conduct international relations, albeit with a very loosely structured and inefficient central government. After the failure of the union under the Articles of Confederation, the thirteen states joined the modern union via ratification of the United States Constitution, beginning in 1789. Under Article IV of the Constitution, which outlines the relationship between the states, the Congress has the power to admit new states to the union. The states are required to give "full faith and credit" to the acts of each other's legislatures and courts, which is generally held to include the recognition of legal contracts, marriages, criminal judgments, and - at the time - slave status. The states are guaranteed military and civil defense by the federal government, which is also required to ensure that the government of each state remains a republic. The Constitution is silent on the issue of the secession of a state from the union. The Articles of Confederation had stated that the earlier union of the colonies "shall be perpetual", and the preamble to the Constitution states that Constitution was intended to "form a more perfect union". In 1860 and 1861, several states attempted to secede, but were brought back into the Union by force of arms during the Civil War. Subsequently, the federal judicial system, in the case of Texas v. White, established that states do not have the right to secede without the consent of the other states.
- Four of the states bear the formal title of Commonwealth: Kentucky, Massachusetts, Pennsylvania, and Virginia. In these cases, this is merely a name and has no legal effect. However, the United States has non-state areas called commonwealths (Puerto Rico and the Northern Marianas) which do have a legal status different from the states.
- States are free to organize their judicial systems differently from the federal judiciary, as long as due process is protected. See state supreme court for more information. For example, most lawsuits in the state of New York are filed in the Supreme Court, and then appealed to the Appellate Division of the Supreme Court. The highest court in New York is the Court of Appeals.
- The joint resolution which admitted the Republic of Texas to the Union as a state guaranteed Texas the right to divide itself up into up to 5 states. This clause may be redundant, however, as any such state would arguably require Congressional approval, just as when Maine was split off from Massachusetts; it may also be unconstitutional, as reducing the equal suffrage of the other states in the United States Senate.

List of states

The states, with their U.S. postal abbreviations, traditional abbreviations, capitals and largest cities, are as follows. For a complete list of non-state dependent areas and other territory under control of the U.S., see United States dependent areas. State names speak to the circumstances of their creation. (See the lists of U.S. state name etymologies and U.S. county name etymologies for more detail.)
- Southern states on the Atlantic coast originated as British colonies named after British monarchs: Georgia, the Carolinas, Virginia, and Maryland. Some northeastern states, also former British colonies, take their names from places in the British Isles: New Hampshire, New Jersey, New York.
- Many states' names are those of Native American tribes or are from Native American languages: Kansas, Massachusetts, Hawaii, Connecticut, Missouri, Iowa, Wisconsin, Illinois, Minnesota, the Dakotas, Mississippi, Texas, Utah, and others.
- Because they are on territories previously controlled by Spain or Mexico, many states in the southeast and southwest have Spanish names. They include Colorado, New Mexico, Florida, and Nevada.
- Because it was previously a French colony, Louisiana is named after the Louis XIV (King of France at the time).
- The origins of the names of California, Oregon, Idaho, and Rhode Island are unknown, although various theories exist.

Trivia

Names

- "Georgia" can refer to either a U.S. state or to an independent country in the Caucasus.
- The name "New York" can refer to any one of three geographical levels: a state, a city in that state, or a county (coterminous with the borough of Manhattan) in that city.
- "Washington" is a state, a city corresponding to the District of Columbia (and thus not part of any state), and a number of cities and counties in various states. See the list of places named for George Washington.
- The state of Washington is the only state named after a U.S. President (or after a person born within the area now comprising the U.S., for that matter).
- The official name of Rhode Island is "the State of Rhode Island and Providence Plantations."
- Only two states have state capitals named for the state (however, such name-sharing occurs commonly with states and provinces in some other countries, where the state or province actually often takes its name from a capital city): Oklahoma, with capital Oklahoma City, and Indiana, with capital Indianapolis (which means Indiana City). Iowa City, Iowa was the first state capital of Iowa but the capital was later moved to Des Moines, Iowa.
- Maine is the only state with a one-syllable name.

Geography

- Colorado and Wyoming are bounded by two circles of latitude and two meridians each, i.e. they appear to be rectangles in a cylindrical map projection.
- Colorado, Utah, and Wyoming are the only states whose borders are made up of only straight lines (taking meridians and circles of latitude as straight lines) and, thus, the only states whose borders completely ignore natural features.
- Every state—except Hawaii, which has no land boundaries—has straight lines as at least part of its boundaries. These are usually combined with rivers (see river borders of U.S. states), ridge lines and other natural boundaries. Pennsylvania and Delaware are unique in that their common border is an arc of a circle, see The Twelve-Mile Circle.
- The lower peninsula of Michigan is shaped like a mitten; Louisiana is shaped like a boot.
- Alaska, Florida, Idaho, Maryland, Nebraska, Oklahoma, Texas and West Virginia have panhandles.
- Alabama, Missouri, New Mexico and Mississippi have bootheels.
- Alaska and Hawaii are the only states that are not physically connected to other states; Maine is the only state that borders only one other state. Missouri and Tennessee each border eight other states, the most for any state.
- Arizona, New Mexico, Colorado, and Utah are the only four states to share a common border, known as the "Four Corners."
- Appearances given by the stereographic projection to the contrary, Minnesota is the northernmost of the forty-eight contiguous United States, as a northern spur of the state contains a portion of Lake of the Woods. At one time it was thought that Lake of the Woods contained the headwaters of the Mississippi River (now known to be at Lake Itasca).
- Alaska is the northernmost state and the westernmost state. Some would argue that it is also the easternmost state, as the Aleutian island chain crosses the 180º line of longitude.

Grouping of the states in regions

Alaska, The South and The Northeast. Note that Alaska and Hawaii are shown at different scales, and that the Aleutian Islands and the uninhabited Northwestern Hawaiian Islands are omitted from this map.]] States may be grouped in regions; there are endless variations and possible groupings, as most states are not defined by obvious geographic or cultural borders. For further discussion of regions of the U.S., see the list of regions of the United States.

State lists

References

External links

- [http://factfinder.census.gov/bf/_lang=en_vt_name=DEC_2000_SF1_U_GCTPH1R_US9S_geo_id=01000US.html Tables with areas, populations, densities and more (in order of population)]
- [http://factfinder.census.gov/bf/_lang=en_vt_name=DEC_2000_SF1_U_GCTPH1_US9_geo_id=01000US.html Tables with areas, populations, densities and more (alphabetical)]
- [http://www.usnewspapers.org US Newspapers by State]
- [http://www.infoplease.com/ipa/A0854966.html Origin of State Names] United States, States of the Category:Subdivisions of the United States
- U.S. State