the copyright on the operating system’s source code (a de jure property right) and the company also refrained from making the source code publicly available (a de facto property right).
606. The meaning of a “competitive price” in software is far from clear. Because software is a high-fixed-cost industry, marginal-cost pricing would not cover the fixed costs of software development. A firm that did not price at least at average cost would not stay in business long, all other things equal. By one calculation, Microsoft charged far less for Windows than a profit- making monopolist should have in theory, suggesting that the firm did not consider the applications barrier to offer all that much protection (Reddy, Evans and Nichols 2002).
607. The analogy is far from perfect and may be misleading. If a firm tries to drive a rival out of business by lowering its price below cost, that lower price benefits consumers in the short run (and often in the long run as well if, as is often the case, the would-be predator cannot keep new competi- tors from coming back into the market once it raises the price back up). In this case, the government argued, Microsoft’s behavior harmed Netscape without conferring any benefits on consumers. Notice also that in a normal predatory-pricing case, the would-be predator is trying to drive a rival out of the relevant market. Yet in charging Microsoft with monopoly, the government examined only Microsoft’s share of the existing operating-system market and did not consider browsers and other potential non–operating system competitors as part of the relevant market.
608. Melamed and Rubinfeld (2007). For a description of the arguments of the govern- ment’s testifying economists, see Bresnahan (2002); and for those of Microsoft’s economists, see Evans, Nichols, and Schmalensee (2001).
609. William Saletan, “Microsoft Plays Dead,” Slate, January 28, 1999.
610. United States of America, Appellee v. Microsoft Corporation, Appellant, 253 F.3d 34 (D.C. Cir. 2001). Importantly, the appeals court left standing the finding that Microsoft had a mono- poly in the market for Intel-compatible personal computers—on the grounds that Microsoft had never offered rebuttals to the government’s claims. This opened the door to a welter of private antitrust suits against Microsoft. (Disclaimer: I was a testifying expert for the plaintiff in one of these private cases, Bristol Technology, Inc. v. Microsoft Corp., 127 F. Supp. 2d 85 (D. Conn. 2000).) Opening a playbook it would use repeatedly in the twenty-first century, the Eu- ropean Union also sued when a European firm that made audio-player software complained that Microsoft had included an audio player in Windows.
666 Notes to Epilogue
611. The appeals court also removed Jackson from the case because he had “engaged in im- permissible ex parte contacts by holding secret interviews with members of the media and made numerous offensive comments about Microsoft officials in public statements outside of the courtroom, giving rise to an appearance of partiality.”
612. Stipulation, Civil Action No. 98-1232 (CKK), November 6, 2001, https://www.justice .gov/atr/case-document/stipulation-65 (accessed June 27, 2021).
613. “AOL Says Deal to Acquire Netscape Has Been Completed,” Wall Street Journal, March 18, 1999. AOL was interested in Netscape’s server-software business, not in the browser.
614. Hovenkamp (2005, p. 298).
Epilogue: Then and Now
1. Although applied to the conspicuously rich at the end of the nineteenth century, the term actually comes from the title of an early novel by Mark Twain and Charles Dudley Warner (1873) that has nothing to do with that era. The novel takes place in the years immediately after the Civil War, and it deals with low-level greed and political corruption rather than anything remotely resembling industrial capitalism. The title is almost certainly meant ironically.
2. Nicholas (2019, p. 288). Thirty-two percent by value of these investments were in Silicon Valley.
3. Ofek and Richardson (2003).
4. NASDAQ OMX Group, NASDAQ Composite Index, FRED, Federal Reserve Bank of St. Louis, https://fred.stlouisfed.org/series/NASDAQCOM (accessed August 26, 2021).
5. Samuel H. Williamson, “S&P Index, Yield and Accumulated Index, 1871 to Present,” Mea- suring Worth, https://www.measuringworth.com/datasets/sap/ (accessed August 9, 2022).
6. Mallaby (2016, pp. 580–81).
7. Nanda and Rhodes-Kropf (2017).
8. Greenspan and Wooldridge (2018, p. 382).
9. Greenspan (2008, p. 228).
10. US Bureau of Labor Statistics, Unemployment Rate, FRED, Federal Reserve Bank of
St. Louis, https://fred.stlouisfed.org/series/UNRATE (accessed August 26, 2021).
11. World Bank, Inflation, consumer prices for the United States, FRED, Federal Reserve BankofSt.Louis,https://fred.stlouisfed.org/series/FPCPITOTLZGUSA(accessedAugust27,
2021).
Williamson (2006, p. 232).
US Department of Homeland Security, 2019 Yearbook of Immigration Statistics, Table 1.
Autor, Dorn, and Hanson (2016).
Pan, Xu, and Zhao (2020).
Selgin, Beckworth, and Bahadir (2015).
Mallaby (2016, pp. 595–96).
Greenspan (2008, pp. 228–29).
Bernanke, Gertler, and Gilchrist (1996).
20. Rajan (2010, p. 109).
21. Drechsler, Savov, and Schnabl (2019). 22. Lewis (2010).
Notes to Epilogue 667
23. Rajan (2010, pp. 132, 160).
24. Board of Governors of the Federal Reserve System (US), Effective Federal Funds Rate, FRED, Federal Reserve Bank of St. Louis, https://fred.stlouisfed.org/series/FEDFUNDS (ac- cessed September 2, 2021).
25. Dang, Gorton, and Holmström (2020).
26. Gorton (2010).
27. Pew Research Center, Internet/Broadband Fact Sheet, https://www.pewresearch.org
/internet/fact-sheet/internet-broadband/ (accessed September 4, 2021).
28. US Federal Communications Commission, Industry Analysis and Technology Division, Wireline Competition Bureau, “Internet Access Services,” various years, https://www.fcc.gov
/internet-access-services-reports (accessed September 4, 2021).
29. Pew Research Center, Mobile Fact Sheet, https://www.pewresearch.org/internet/fact
-sheet/mobile/ (accessed September 4, 2021).
30. Kushida, Murray, and Zysman (2015).
31. Brynjolfsson and McAfee (2014, p. 50).
32. Kushida, Murray, and Zysman (2015, p. 16).
33. Michael DeGusta, “Are Smart Phones Spreading Faster than Any Technology in Human
History?” MIT Technology Review, May 9, 2012. The speed of the smartphone revolution also depended on the widespread availability of relatively fast 3G and 4G cellular technology (Evans, Chang and Joyce 2019).
34. In the view of the technology columnist of the New York Times, the smartphone “was the only thing that mattered in tech in the 2010s.” As Jobs predicted, PCs would become like
