Table of Contents

Promoting Competition in Global Markets

Promoting Competition in Global Markets

A Multi-National Approach

P. J. Lloyd and Kerrin M. Vautier

This book sheds new light on a major issue on the international trade policy agenda – the promotion and defence of competition in globalizing markets. The authors discuss multi-national approaches to competition policy in the WTO, European Union, the Americas, OECD, UNCTAD and CER. They investigate the policy responses to anti-competitive, cross-border business transactions and argue that a growing reliance on competition law is not in itself sufficient to promote competition in globalizing markets.

Chapter 12: An Approach to Promoting Competition in Global Markets

P. J. Lloyd and Kerrin M. Vautier

Subjects: economics and finance, international economics

Extract

Page 187 12—  An Approach to Promoting Competition in Global Markets As a consequence of globalizing markets, issues of competition increasingly involve more than one country. This gives rise to a basic problem: markets do not stop at  national borders and therefore dealing with competition issues cannot be limited to national jurisdictions. In response, there have been numerous national and multi­ national approaches to this basic problem. Some nations have sought to make extraterritorial use of their powers and a variety of multi­national approaches is evolving. Some positive initiatives have emerged but many of these are untested or have shown a limited capacity to address cross­border competition problems. These  initiatives have been hampered generally by a failure to recognize the real nature and scope of the issues and by a confusion of objectives. To advance multi­national  initiatives a clear analytical framework is required. Principles for Promoting Global Competition There is a consensus in the OECD countries and a growing recognition among other countries that markets should be contestable and more weight attached to  efficiency in the allocation of scarce resources. Economic theory shows that efficiency generally requires both competitive markets and free trade among nations.  However, most of the multi­national initiatives have been based on the premise that 'competition policy' is a trade­related issue; that is, the central concern has been  that barriers to competition, and in particular anti­competitive private business conduct, reduce the benefits from lowering border barriers to international trade. It  emphasizes...

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