Competitive Advantage and Competition Policy in Developing Countries

Competitive Advantage and Competition Policy in Developing Countries

The CRC Series on Competition, Regulation and Development

Edited by Paul Cook, Raul Fabella and Cassey Lee

The book discusses competition from different theoretical perspectives and examines the implications these viewpoints have for policy. The contributors assess competitiveness in domestic markets and the impact of foreign competition. They also review the experiences of a range of countries in developing competition policy and examine both the strengths and weaknesses of these policies.

Chapter 1: Introduction

Paul Cook, Raul Fabella and Cassey Lee

Subjects: development studies, development economics, law and development, economics and finance, competition policy, development economics, public sector economics, law - academic, law and development


Paul Cook, Raul Fabella and Cassey Lee In recent years there has been an acceleration of interest in competition policy for developing countries. This interest is most evidently seen in the number of countries that have revised old competition laws or have developed new ones. This trend towards the introduction of new competition laws has been accompanied by the development of dedicated competition agencies designed to tackle anti-competitive practices and review cases of mergers and acquisitions. Competition has also been part of the remit of the spate of newly established dedicated regulatory bodies responsible for ensuring economic efficiency and protecting the welfare of consumers arising from the activities of enterprises in the utilities sector, particularly those that have been privatized. This rise of interest in competition in developing countries has a number of explanations (Cook, 2004). Undoubtedly, the interest in the competitiveness of domestic markets and the attention to antitrust-type competition policy has to some extent resulted from the failures of economic reforms in the 1980s, that overly relied on trade liberalization to promote domestic market competition. During that time, World Bank structural adjustment loans did not stipulate conditions for competition policy (Gray and Davis, 1993). The conclusion reached was that trade liberalization by itself did not achieve all it was expected to in terms of increasing productive efficiency and competitiveness in external markets (Tybout, 1992). The idea that trade liberalization would improve domestic competition has led to a reassessment, addressed in this book, that indicates that success...