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Economic Theory and Competition Law

Economic Theory and Competition Law

ASCOLA Competition Law series

Edited by Josef Drexl, Laurence Idot and Joël Monéger

The context for this book is the increasingly complex relationship between economic theory and competition law which gives rise to lively political and academic debate on the direction competition law should take in a more global and innovation-oriented market place.

Chapter 7: Competition Law Should Promote Economic and Social Welfare by Ensuring the Freedom to Compete – A Lawyer’s View

Roger Zäch

Subjects: economics and finance, competition policy, law and economics, law - academic, competition and antitrust law, law and economics


Roger Zäch* 1 INTRODUCTION In connection with the subject of the role of economics in competition law, I will focus on the so-called more economic approach. First of all, let me make clear that my critical view of some recent developments concerning the more economic approach refers to the application of the law. I will not talk in particular about making new law or amending existing law. I believe that it is important to differentiate clearly between the two functions: law making and application of law. As far as legislating is concerned, the legislators, when developing or changing competition law, must – and this is quite obvious – have sound economic knowledge. Since competition is an economic phenomenon, the legislature must take appropriate economic theories into consideration; consequently they should use an economic approach. The reason is: There cannot be good law without good knowledge of the subject matter to which that law applies. However, I also want to point out that the legislature has to respect some legal principles, for example the principle that legal provisions must be predictable. This chapter deals with possible impacts of the ‘more economic approach’ in applying competition law. Recently, the EU enacted provisions that could lead to a tendency for restrictions of competition being appraised more and more by economic criteria, such as social or consumer welfare or, in short, under efficiency criteria. * Prof. Dr., University of Zurich, Switzerland; Vice President of the Swiss Competition Commission. 121 122 The status of e...

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