What makes a monopoly in the age of Amazon?

It’s not often that a government agency decides to do a wholesale rethink of how to do its job. But that’s what’s happening at the Federal Trade Commission.

On Thursday, the federal watchdog tasked with protecting consumers from fraud and anti-competitive behavior kicked off months-long series of hearings. The goal: Figuring out whether regulators need to be tougher on companies that have staked out ever-larger chunks of the markets they serve.

“The broad antitrust consensus that has existed within the antitrust community, in relatively stable form for the last 25 years, is being challenged in at least two ways,” said FTC Chairman Joseph Simons in his introduction.

Challenge number one: An emerging body of research shows that many industries have become concentrated in the hands of a few very large companies. This comes at a time when antitrust enforcement has been getting less aggressive over the past several decades. (Think airlines, for example, where four companies now control 68% of the passenger miles flown in the United States.)

Another challenge: A progressive school of activists and scholars who say that antitrust policy shouldn’t be concerned only with prices charged to consumers, but also with issues like labor standards, economic inequality and corporate influence on politics, where there’s now more evidence that industry consolidation is having an impact.

The series of hearings is modeled on a similar exercise conducted in the 1990s, when the FTC took a broad look at how globalization and technology were impacting antitrust policy, in the midst of what was then the largest wave of mergers in United States history.

The FTC is now grappling with what to do about tech giants, like Facebook and Google, that have come to dominate advertising and internet search because of a mixture of technological superiority and “network effects,” through which services become more attractive the more users they have.

“It’s not competition in the market, it’s competition for the market,” said panelist Fiona Scott Morton, an economics professor at the Yale School of Management.

Amazon, in particular, has posed a puzzle for established antitrust doctrine. It has tended to lower prices for consumers, but it is also now by far the largest portal for online shopping, which gives it enormous power over the producers that sell on its platform.

Think tanks like the Open Markets Institute and the Roosevelt Institute have argued that the FTC, along with the antitrust division of the Justice Department and other law enforcement bodies, should prevent more mergers and potentially even break up companies that appear to be exercising too much market power.

“Market concentration and market power lead to stagnant wages, fewer new businesses, and a weakened supply chain,” write Adil Abdela and Marshall Steinbaum of the Roosevelt Institute. “As a result, many participants in the economy feel their fate is out of their own hands… It’s time for the agencies to stop ignoring the problem or going out of their way to deny it exists.”

However, that point of view is far from generally accepted inside the Beltway.

President Donald Trump has lashed out at Amazon on Twitter and said on Fox News that it has a “huge antitrust problem.” But the Department of Justice’s antitrust division has publicly defended its stance of sticking to the “consumer welfare” standard rather than implementing a more expansive one that might implicate the trillion-dollar company.