REVISION OF this country's obsolescent antitrust laws is long overdue, and the administration is absolutely right to pursue it. The administration is also right to argue, as Secretary of Commerce Malcolm Baldrige did last week, that antitrust policy has to take the realities of world trade into account. When two companies propose to merge, the Justice Department and the courts look at their shares of their market. But for companies in world competition, the share of the national market is irrelevant. It's the world market that counts, the adminstration points out. So far, so good. But Mr. Baldrige then proceeds to a much more questionable proposition. He has recommended to President Reagan that any industry hurt by imports be offered a five-year period to reorganize with no antitrust restrictions on mergers. That's much too sweeping.

This idea recalls events in the steel industry early last year when the Justice Department objected to a merger between two big companies. That set off a sharp dispute within the administration, in which Mr. Baldrige maintained that the merger was necessary to strengthen both partners in dealing with their foreign competition. The companies argued that imports ensured a competitive market in steel. But Justice observed in reply that imports from most of the major producers abroad were under limits negotiated by the government. Imports guarantee real competition only when markets are wide open, and in the case of steel they are not. And when they are not, it's dangerous to lift the restrictions on mergers. The right test of a merger is the nature of the competition, not the pain inflicted by imports.

The purpose of antitrust reform is properly to sharpen the rules of competition, and adapt them more consistently to the markets in which American companies are now engaged. There's a lot of room for improvement. But mergers are rarely an effective remedy for industries losing ground to imports. Bigger dinosaurs are not necessarily better dinosaurs.

There is talk in Congress about the need for consolidation in the shoe industry, but the shoemakers' troubles won't be solved by mergers. In some cases restructuring an industry can make an important difference, but any restructuring that requires suspension of normal antitrust standards needs to be approached with immense caution. For those companies currently under the greatest pressure from imports, the most effective relief would not be antitrust exemptions. It would be a change in basic economic policy to get the federal deficit under control and bring the dollar's exchange rate down.