ps an antitrust investigation. And this is the point! Critics of mergers are defenders of the status quo and opponents of the dynamism inherent in the free market. This makes them, in essence, advocates of privilege, for they would freeze the economic system where it is today, shutting out the aspirants and sheltering yesterday's achievers. These critics will tell you they only want to preserve competition, but that is not what they will accomplish. Mergers are competitive by nature. Competition is the cooperative process in which entrepreneurs seeking profit try to predict future consumer demand and arrange productive resources accordingly. When the law stops or hampers this activity, it cripples the process and harms consumers. Freedom to Enter is the KeyThe critics' related worry about market concentration is also off the mark. The interests of workers and consumers do not depend on a specified number of firms or market structure. They depend on freedom of entry, uninhibited by regulation, taxation, inflation, licensing and patents. Moreover, the notion of concentration is inherently arbitrary. It implies that an observer categorizes products, then counts the number of suppliers in each category. But the observer's categories are irrelevant to how consumers, motivated by personal considerations, respond to the array of products before them. Unbeknownst to the observer, consumers may regard seemingly disparate products as substitutes for each other, yanking the rug out from under the concentration doctrine. Consumers, and no one else, ultimately determine the structure of markets; their shifting preferences guarantee that markets are always in flux and that temporary advantage is the most any producer can hope for. The reasons for the current wave of mergers are many and complex. Undoubtedly, inflation - which makes acquiring existing assets preferable to building new ones-has much to do with it. So does the thick web of regulations a...
