ubject to rate regulation may well find it profitable to integrate vertically. Gaining control of a second, unregulated level of production would allow the firm to earn the profits foreclosed by regulators (Bowman 1957; Bork 1978; see also Brennan 1987 for an application to telephony). In such cases, it is arguably appropriate to prohibit vertical integration in order to isolate and quarantine the monopolist. Such regulation is justified, however, only when any attempt to break up the monopoly would ultimately prove futile. As the market at issue becomes increasingly open to competition, both rate regulation and the concomitant prohibition of vertical integration become equally unwarranted. Scholarship associated with the post-Chicago school of antitrust law and eco- nomics has used game theory to identify other circumstances under which vertical integration can harm competition. Interestingly, these models presuppose the exis- tence of dominant-firm and oligopoly market structures in the primary market, which necessarily presupposes that both the primary and secondary markets are highly concentrated and protected by entry barriers. In the absence of such struc- tural features, these formal models recognize that vertical integration may be just as likely to lower price and increase welfare and that the ability of existing players 30 Brown Shoe Co. V. United States, 370 U.S. 294 (1962). Networks in Telecommunications or new entrants to expand their outputs will be sufficient to defeat any attempt to increase price above competitive levels (Salop and Scheffman 1983; Salinger 1988, 1991; Hart and Tirole 1990; Ordover et al. 1990; Whinston 1990; Riordan and Salop 1995; Riordan 1998). The post-Chicago literature has thus done little to disturb the basic conclusions that vertical integration is unlikely to harm competition unless the relevant markets are concentrated and protected by entry barriers and that vertical integration may yield efficiencies. At the same time, economic theorists increasingly recognized that ve