Adam Smith’s views on collusion were injected into the Supreme Court’s ruling in Bell Atlantic v. Twombly as Justice Stevens puzzled over why a collusive action might be viewed as “right.” Motivation by a desire for approbation provides Smith’s explanation for the existence of well- functioning groups. “Right” action is approved by the group. The question is what happens when the groups are in conflict. For Smith, collusion is one instance of the larger problem of faction in which a small group organizes to exploit the larger society.

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Copyright © 2008 The University of Chicago Press. This article is first appeared in Supreme Court Economic Review 16:1 (2008), 159-164.

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