Unfairness, Reconstructed

Abstract

A paradigm shift is afoot at major federal consumer protection agencies. For four decades, a bipartisan bloc of bureaucrats has seen the purpose of consumer protection as promoting informed consumer choice or “consumer sovereignty.” The idea was that informed consumers in competitive markets would protect themselves by choosing among sellers. Ensuring access to information would then shore up markets’ self-correcting tendencies without requiring moral judgment. In the past few years, by contrast, regulators have prioritized sector-wide regulation, enforcement sweeps, and strategic cases against market leaders. They have justified their actions not (exclusively) in terms of informed choice or efficiency but in terms of values like protecting the vulnerable, preventing harassment, preserving privacy, and correcting for unjust inequalities. Focusing doctrinally on uses of the unfair-practices authority shared by several agencies, this Article situates the shift both historically and theoretically. Historically, it argues that consumer sovereignty lost ground after the global financial crisis of 2007 and controversies over Big Tech. Theoretically, it argues that the consumer sovereignty framework relied on a too simple model of markets as deviations from “perfect competition” that needed only better information to get back in line and that the paradigm emerging in its place is properly committed to correcting for power asymmetries in irredeemably imperfect markets. I call the new paradigm an “antidomination framework” and defend it.