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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