EOTO 2

    The Sherman-Anti trust act was created in 1890. This was the first legislation enacted by the U.S. Congress. The reason it was passed was to counter concentrations of power that interfered with trade, as well as to reduce economic competition. This law was named after John Sherman, who had been a part of the U.S. House of Representatives, U.S Senate, as well as many other groups, in the course of his lifetime. During the lifetime of this act, it was primarily used against businesses who had acquired industrial monopolies, but rarely succeeded- it was most successful against trade unions. Many laws and acts released afterwards changed how this act worked, one of which being the Clayton antitrust Act.

    Vertical Consolidation is a Consolidation that involves two or more entities at different levels in the supply chain, such as a Facilities-based Licensee and a reseller that sells that Licensee’s services. This has affected many businesses, most notably through my research, the health care market. Not only did these merges increase costs, but there are areas where hospital services are highly concentrated—where few hospitals compete—correlates to more expensive services. Vertical merging also causes organization and coordination to be more complex, and very few health services reported an increase of quality after they merge. The main reason for this occurring I could find is that there are now less competing groups, so there is smaller motivation for them to do better. With all of this, it is hard to say that vertical consolidation is worth it for these organizations.