Thieves at the Dinner Table
Chapter 7: Conclusion and a postscript
In the introductory paragraphs to this book I identified the ‘big story’ of the first decade of the implementation of the Competition Act as its success. That having been said – and restated – it’s extremely difficult to measure, with any degree of confidence, the quantitative impact of competition law enforcement and merger regulation. There are reason- ably widely-accepted rules of thumb that purport to measure the impact of hardcore cartel conduct on price. It’s possible to undertake retrospective analyses of merger decisions. Some competition authorities, most notably the UK’s Office of Fair Trading, have purported to measure in considerable detail the quantitative economic impact of its activities, even its advocacy functions. While the OFT’s measures of its impact involve some pretty heroic assumptions and reasoning, it’s important that the South African Com- petition Commission makes every effort to develop quantitative measures of its own impact. The Commission has in fact worked with the OFT to develop measures that it is beginning to use. Although I am sceptical of aspects of this empirical measurement – for example, I fear that it will inevitably understate what I think of as the institutional impact as well as the deterrent effect – if it does help counter a sometimes widely-held view that the enforcement activities of the competition authorities do not have a sustained impact on price levels, then it will have played a useful role. The primary impact of robust competition enforcement, including merger regulation, is indirect in nature. It is concerned with the defence and promotion of institutions
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