Edited by Paul Cook, Raul Fabella and Cassey Lee
Chapter 4: Legal Traditions and Competition Policy
Cassey Lee INTRODUCTION The two decades beginning from the early 1980s witnessed signiﬁcant institutional changes in many economies in the world. Socialist countries in Eastern Europe and Central Asia underwent political transformation into democracies and embraced the market system. Other socialist countries that did not undergo political transformation, such as China and Vietnam, began using market mechanisms selectively to enhance their economic performance. At the same time, countries that have already adopted the market system undertook to give market forces a greater role in their economies by divesting state-owned enterprises through large-scale privatization. Economists have also become more interested in the role of institutions in economic growth and development. In the context of the institutional changes that have taken place, economists are pondering over the type of institutions such as property rights protection that should be considered to be essential for the proper functioning of market economies. However, the questions are not just about market institutions but of state interventions that are required to address problems of market failures. One such intervention is competition policy. Currently more than 100 countries around the world have implemented national competition laws. There is suﬃcient theoretical and empirical support to motivate the implementation of competition policy (UNCTAD, 1997). What is debatable, especially from the viewpoint of developing countries, is the form and timing of implementation, that is, whether multilateral competition rules are useful and whether more exemptions ought to be allowed for conﬂicting industrial policies. For countries that have decided to...
You are not authenticated to view the full text of this chapter or article.