There is a nice post summing this up over at the Farmer Hayek blog:
It seems to me that the relationship between anti-trust legislation and
regulation is an under-discussed issue in these cases. Agribusiness
firms are heavily regulated by three of the most powerful regulators in
the US: the FDA, the USDA, and the EPA. Many regulations function as
fixed costs, implying that there are economies of scale in regulatory
compliance. Thus, the greater the regulatory burden placed on firms in
an industry, the greater the inducement to merge.
Similarly, from a 2003 issue of Regulation:
'In the end, EPA and the USDA
regulatory policies place federal bureaucrats in the middle of virtually
all field trials of gene-spliced plants, spelling disaster for small
businesses and academic institutions whose scientists lack the resources
to comply with burdensome, expensive, unnecessary regulation. The cost
of field-testing gene-spliced plants is as much as 20-fold higher than
for virtually identical plants crafted with older, less precise genetic
techniques.' -Regulation, Summer 2003
See also:
More details related to this from a 2010 post at EconomicSense - Monsanto Antitrust Case
Reference:
Henry Miller and Gregory Conko. 'Bootleggers and Biotechs.' Regulation. Summer 2003
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