Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Thursday, January 21, 2021

Concentration of the Mobile Telecommunications Markets and Countries' Competitiveness

Concentration of the Mobile Telecommunications Markets and Countries' Competitiveness

By:

David Bardey; Danilo Aristizábal; Bibiana Sáenz; Santiago Gómez

Abstract:

Developing a database that includes 59 countries, our study sheds light on the role of mobile telecommunications markets' concentration on countries' competitiveness. Performing several estimations and using an instrumental variable that aims to explain the degree of concentration in mobile phone markets, we find that the higher is the concentration in this industry, the lower is the use of the information technology and communication (ICT). On the other hand, we also find that the use of ITC is positively correlated to countries' competitiveness. Thus, our results reveal positive spillover effects of the mobile phone industry on countries' competitiveness and suggest that all policies that aim to reduce concentration and market power in the mobile phone industry is welcomed.

URL:

http://d.repec.org/n?u=RePEc:col:000089:018482&r=com

January 21, 2021 | Permalink | Comments (0)

Asymmetric general oligopolistic equilibrium

Asymmetric general oligopolistic equilibrium

By:

Quint, Ansgar F.; Rudsinske, Jonas F.

Abstract:

We develop an asymmetric general oligopolistic equilibrium (AGOLE) model, which extends the range of possible applications in general oligopolistic equilibrium modelling. The AGOLE allows to incorporate endogenous and asymmetric marginal utilities of income across countries.As a first exemplary application, we analyze the effects of asymmetric labor market policies. When one country increases its labor supply per capita, it is optimal for its firms to supply a part of the additional production to the other country at reduced prices to artificially inflate domestic prices. This results in a spillover effect letting consumption increase abroad due to a change in the terms of trade. In AGOLE, oligopolistic competition can induce asymmetric price reactions that shift real income and demand between the two countries. We argue that incorporating this cross-country demand channel is crucial for analyzing asymmetric countries or policies in presence of firms with market power.

URL:

http://d.repec.org/n?u=RePEc:zbw:cegedp:405&r=com

January 21, 2021 | Permalink | Comments (0)

2021 CRESSE Lawyers' Course on "The Role of Economics in Competition Law and Practice"

2021 CRESSE Lawyers' Course on
"The Role of Economics in Competition Law and Practice"

 

EARLY BIRD
Complete your registration until March 12th 2021
to receive a 20% discount.

 

The 2021 CRESSE Lawyers' Course will introduce the economic theories that underlie competition law, the methods and tools that are used to assess whether business practices are socially harmful or benign, and the economic issues related to the enforcement of the law. The goal of the course is to enable participating lawyers to communicate effectively with economists when they have to cooperate with them in cases and to read their Opinions in an informed manner.

CRESSE's 7th Lawyers’ Course will take place from July 2, through July 5.

***

We very much hope that the situation with the COVID-19 pandemic in spring/summer of 2021 will not be such as to impede the physical materialization of the CRESSE courses in CRETE.
 

If the situation in many countries prevents us from physically organizing the CRESSE courses, all the lectures will be delivered online (with reduced participation fees).



The Scientific Committee will announce its decision on how the 15th CRESSE Schools will be held by May 3, 2021.

 
 

This year is the 1st edition of the CRESSE – CPI Young Researchers Awards.

Selection will be undertaken by the Scientific Committee of CRESSE.  The awards will be made during the annual Conference that will take place on July 2 through July 4 in Crete, Greece. The value of each award will be 1,500 Euro.

An additional award will be given to the most read 2021 CRESSE Antitrust Chronicle paper.

For questions and assistance, please don’t hesitate to contact us.

 

January 21, 2021 | Permalink | Comments (0)

A paradoxical convergence: French economists and the policy towards cartels from the 1870s to the eve of the Great Depression

A paradoxical convergence: French economists and the policy towards cartels from the 1870s to the eve of the Great Depression

By:

David Spector (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE - Paris School of Economics)

Abstract:

Just like in other industrial countries, cartelization was widespread in France after the 1870 decade. Cartels, and the public policy towards them, were frequently addressed in the public debate. This article deals with the stance taken by French economists on this subject until the Great Depression. Although they were divided in several groups that were in sharp disagreement on most scientific and policy issues, French economists were almost united in their lack of support for anti-cartel policy. The liberal economists'opposition stemmed from their general hostility to government intervention. Unlike in the English-speaking world, where many economists otherwise critical of government gradually became supportive of antitrust after mounting evidence had revealed the scope of certain kinds of exclusionary behavior, the French liberal economists remained constant in their opposition. The more reform-minded university professors, as well as the sociologists-economists of the Durkheimian school, were unenthusiastic about policies meant to safeguard competition because they viewed ‘excessive' market competition as destabilizing and wasteful. Finally, the most prominent experts in industrial economics, who were employed by large companies or professional organizations, also advocated a hand-off approach, in accordance with their employers'preferences.

URL:

http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-02967599&r=com

January 21, 2021 | Permalink | Comments (0)

Competition, Profit Share and Concentration

Competition, Profit Share and Concentration

By:

J. BOUSSARD (Banque de France); R. LEE (Insee- Crest)

Abstract:

This paper investigates the distributional impact of ’winner-takes-most’ competition and its role in shaping recent macroeconomic trends in advanced economies. We document a positive correlation between variations in industry labor and capital shares, and a positive correlation between variations in industry profit shares and industry concentration levels. However using micro-based industry data on firm-level profit margins, we find a negative correlation between industry concentration and a wide range of moments from the distribution of profit shares. We propose a dynamic general equilibrium model with heterogeneous firms, in which an increase in competition, whereby consumers become more price-sensitive and firm markups decrease, leads to a rise in concentration, a decrease in firm-level profit shares but an increase in industry-level profit shares. We study the effect of a change in the competitive environment on the Balanced Growth Path (BGP). In contrast with representative firm models, competition reduces the probability of successful entry and product diversity. If consumers value product diversity, we show that output growth, the natural interest rate, and welfare decrease with competition.

URL:

http://d.repec.org/n?u=RePEc:nse:doctra:g2020-04&r=com

January 21, 2021 | Permalink | Comments (0)

Wednesday, January 20, 2021

Transactional fairness and unfair price discrimination in consumer markets

Transactional fairness and unfair price discrimination in consumer markets

By:

Bruce Lyons (Centre for Competition Policy and School of Economics, University of East Anglia); Robert Sugden (Centre for Competition Policy and School of Economics, University of East Anglia)

Abstract:

There is growing public concern about the ‘unfairness’ of many pricing practices that have become common in consumer, particularly digital, markets (e.g. auto-renewal at a high price, expensive default add-ons). Industrial and behavioural economists have developed theories that explain the conditions under which these practices are profitable for firms, and their implications for consumer welfare. We argue that there is a mismatch between the welfare economic principles on which this theoretical work is grounded and the normative perspective in which the pricing strategies in question are viewed as unfair. As a result, when regulators look to economics for guidance about fair pricing, they struggle to reconcile two fundamentally different normative approaches. We develop a concept of ‘transactional fairness’, grounded in the normative approach of Sugden’s ‘Community of Advantage’, that is reflective of public concerns. Transactional fairness requires satisfaction of ‘no deception’, ‘no hindrance’ and ‘public explanation’ criteria. It is complementary to established welfare criteria of economic efficiency and distributional equity, but is based entirely on the relationship between individual buyer and seller. Transactional fairness establishes clear principles with realistic information requirements that are appropriate for compliance by firms. The approach potentially helps restore public faith in markets without either deterring the emergence of (non-deceptive and non-hindering) business models, or requiring frequent ad hoc fire-fighting interventions by regulators.

URL:

http://d.repec.org/n?u=RePEc:uea:ueaccp:2020_07&r=com

January 20, 2021 | Permalink | Comments (0)

Complementary bidding and the collusive arrangement: Evidence from an antitrust investigation

Complementary bidding and the collusive arrangement: Evidence from an antitrust investigation

By:

Robert Clark (Queen's University); Decio Coviello (HEC Montreal); Adriano De Leverano (ZEW - Leibniz Centre for European Economic Research in Mannheim)

Abstract:

A number of recent papers have proposed that a pattern of isolated winning bids may be associated with collusion. In contrast, others have suggested that bid clustering, especially of the two lowest bids, is indicative of collusion. In this paper, we present evidence from an actual procurement cartel uncovered during an anticollusion investigation that reconciles these two points of view and shows that both patterns arise naturally together as part of a cartel arrangement featuring complementary bidding. Using a difference-in-difference approach, we compare the extent of winning-bid isolation and clustering of bids in Montreal's asphalt industry before and after the investigation to patterns over the same time span in Quebec City, whose asphalt industry has not been the subject of collusion allegations. Our findings provide causal evidence that the collusive arrangement featured both clustering and isolation. We use information from testimony of alleged participants in the cartels to explain how these two seemingly contradictory patterns can be harmonized.

URL:

http://d.repec.org/n?u=RePEc:qed:wpaper:1446&r=com

January 20, 2021 | Permalink | Comments (0)

Passive backward acquisitions and downstream collusion

Passive backward acquisitions and downstream collusion

By:

Shekhar, Shiva; Thomes, Tim Paul

Abstract:

We investigate the effects of passive backward acquisitions in their efficient upstream supplier on downstream firms' ability to collude in a dynamic game of price competition with homogeneous goods. We find that passive backward acquisitions impede downstream collusion. The main driver of our finding is that a passive backward acquisition secures an acquirer from zero continuation profits after a breakdown of collusion. This anti-collusive effect cannot be outweighed by a lower collusive price that is set by the cartel to increase the acquirer's profit from its claim on the upstream margin.

URL:

http://d.repec.org/n?u=RePEc:zbw:dicedp:351&r=com

January 20, 2021 | Permalink | Comments (0)

Product switching, market power and distance to core competency

Product switching, market power and distance to core competency

By:

R. MONIN (Insee); M. SUAREZ CASTILLO (Insee - Crest)

Abstract:

Within-firm product switching is recognised as an important source of growth. We examine how portfolio dynamics is related to product market power, product efficiency and within-firm differentiation. We derive perproduct markup and marginal cost following De Loecker et al. (2016) on a large panel of French manufacturers over 2009-2017 and build three novel measures of product similarity. We find that selection based on performance is a leading driver of the performance gap between entrant and incumbent products. Markups are as important as marginal costs in explaining selection patterns. Our results suggest that firms renew their portfolio using trial and error and select the best performing products, closer to their core competency. However at the firm level, most of markup growth is accounted for by a reallocation toward best performing products, with a minor role for product entry and exit in the short run.

URL:

http://d.repec.org/n?u=RePEc:nse:doctra:g2020-06&r=com

January 20, 2021 | Permalink | Comments (0)

Tuesday, January 19, 2021

Effect of Public Procurement Regulation on Competition and Cost-Effectiveness

Effect of Public Procurement Regulation on Competition and Cost-Effectiveness

By:

Bedri Kamil Onur Tas

Abstract:

This paper empirically investigates the impact of public procurement regulation quality on competition and cost-effectiveness. I employ the World Bank’s Benchmarking Public Procurement quality scores. Using extensive data about public procurement in the European Economic Area, Switzerland, and Macedonia, the paper exhibits positive effects of improved regulation quality. Better quality scores are associated with higher levels of competition and cost-effectiveness. Improved regulation quality significantly increases number of bidders and the probability that procurement price is lower than estimated cost

URL:

http://d.repec.org/n?u=RePEc:rsc:rsceui:2019/22&r=com

January 19, 2021 | Permalink | Comments (0)

Incentivized Mergers and Cost Effciency: Evidence from the Electricity Distribution Industry

Incentivized Mergers and Cost Effciency: Evidence from the Electricity Distribution Industry

By:

Robert Clark (Queen's University); Mario Samano (HEC Montreal)

Abstract:

In an effort to lower costs of provision, authorities have encouraged the consolidation of providers for a number of services such as electricity distributors, school boards, hospitals, and municipalities. In this paper we propose an endogenous merger process to evaluate the impact of government-provided incentives on consolidation patterns,and to evaluate the resulting outcomes. The process takes as input estimates from a stochastic frontier cost model, which yields an average cost curve for the industry. Policy parameters are used to simulate final configurations using offers that are the output of a Nash Bargaining problem. The efficiency of candidate merged entities is determined by a relative-influence function that measures the degree to which the combination of the involved firms' levels of efficiency results in cost-increasing amalgamations, and an interconnection cost that measures the impact of the size of the conglomerate that is formed. We calibrate parameters by applying the merger process to replicate the observed industry reconfiguration and then use these parameters to simulate the consolidation patterns that would have resulted from different policy incentives. We apply the method to the case of Ontario, where past mergers of local electricity distribution companies were incentivized by transfer tax reductions and a further round of mergers was recently proposed. Our findings suggest that the proposed tax incentive would have no impact on efficiency levels and consolidation patterns, and that even a substantial subsidy would still leave about five times as many LDCs as desired by policy makers.

URL:

http://d.repec.org/n?u=RePEc:qed:wpaper:1447&r=com

January 19, 2021 | Permalink | Comments (0)

Monday, January 18, 2021

Growing by the Masses - Revisiting the Link between Firm Size and Market Power

Growing by the Masses - Revisiting the Link between Firm Size and Market Power

By:

Hassan Afrouzi; Andres Drenik; Ryan Kim

Abstract:

How are a firm’s size and market power related to one another? Combining micro-data about producers and consumers, we document that while firms mainly grow by selling to more customers, their markups are only associated with their average sales per customer. To study the macroeconomic implications of these facts, we develop a model of firm dynamics with endogenous customer acquisition and variable markups. Relative to a model without customer acquisition, our model generates higher concentration at the top, but a lower aggregate markup. Our quantitative analysis reveals large welfare and efficiency losses due to (mis)allocation of customers across firms. By increasing market concentration among the most productive firms, the efficient allocation achieves 11% higher aggregate productivity and 15% higher output.

URL:

http://d.repec.org/n?u=RePEc:ces:ceswps:_8633&r=com

January 18, 2021 | Permalink | Comments (0)

Empirical methodology for the evaluation of collusive behaviour in vertically-related markets: an application to the "yogurt cartel" in France

Empirical methodology for the evaluation of collusive behaviour in vertically-related markets: an application to the "yogurt cartel" in France

By:

Céline Bonnet (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Zohra Bouamra-Mechemache (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract:

The paper proposes a five-step methodology based on the estimation of demand and supply models to test the existence of manufacturers' collusive behaviour and evaluate its impact on market and welfare. This methodology allows for the estimation of profit sharing in vertical chains by properly modelling the contracting stage between manufacturers and retailers. We apply this methodology to analyse the effects of the "yogurt cartel" that prevailed in the French dairy dessert market between private label providers during the period 2006-2012. We find that data supports collusive behaviour between private label manufacturers, and lead to average price increase varying from 7.3% and 11.3%, according to the product category. We found an umbrella effect on dairy products sold under national brands at the wholesale level but not at the retail level. The cartel benefits manufacturers both for the sales of the national brand and private label products, while retailers lost profits over the private label products but gained profits over the national brand products. The cartel implies a relatively low decrease in consumer welfare —lower than the gain for the industry—such that the overall welfare effect of the cartel is positive.

URL:

http://d.repec.org/n?u=RePEc:hal:journl:hal-02952676&r=com

January 18, 2021 | Permalink | Comments (0)

Selling Consumer Data for Profit: Optimal Market-Segmentation Design and its Consequences

Selling Consumer Data for Profit: Optimal Market-Segmentation Design and its Consequences

By:

Kai Hao Yang (Cowles Foundation, Yale University)

Abstract:

A data broker sells market segmentations created by consumer data to a producer with private production cost who sells a product to a unit mass of consumers with heterogeneous values. In this setting, I completely characterize the revenue-maximizing mechanisms for the data broker. In particular, every optimal mechanism induces quasi-perfect price discrimination. That is, the data broker sells the producer a market segmentation described by a cost-dependent cutoff, such that all the consumers with values above the cutoff end up buying and paying their values while the rest of consumers do not buy. The characterization of optimal mechanisms leads to additional economically relevant implications. I show that the induced market outcomes remain unchanged even if the data broker becomes more active in the product market by gaining the ability to contract on prices; or by becoming an exclusive retailer, who purchases both the product and the exclusive right to sell the product from the producer, and then sells to the consumers directly. Moreover, vertical integration between the data broker and the producer increases total surplus while leaving the consumer surplus unchanged, since consumer surplus is zero under any optimal mechanism for the data broker.

URL:

http://d.repec.org/n?u=RePEc:cwl:cwldpp:2258&r=com

January 18, 2021 | Permalink | Comments (0)

Using Information to Amplify Competition

Using Information to Amplify Competition

By:

Wenhao Li (Department of Economics, The Pennsylvania State University)

Abstract:

I characterize the consumer-optimal market segmentation in competitive markets with differentiated products. I show that this segmentation is public---in that each firm observes the same market segments---and takes a simple form: in each market segment, there is a dominant firm favored by all consumers in that segment. By segmenting the market, all but the dominant firm maximally compete to poach the consumer's business, setting price to equal marginal cost. Information, thus, is being used to amplify competition. This segmentation simultaneously generates an efficient allocation and delivers to each firm its minimax profit.

URL:

http://d.repec.org/n?u=RePEc:arx:papers:2010.05342&r=com

January 18, 2021 | Permalink | Comments (0)

Cartel deterrence and manager labor market in US and EU antitrust jurisdictions: theory and experimental data

Cartel deterrence and manager labor market in US and EU antitrust jurisdictions: theory and experimental data

By:

Miguel A. Fonseca (Department of Economics, University of Exeter and NIPE, Universidade do Minho); Ricardo Gonçalves (Universidade Católica Portuguesa, Católica Porto Business School and CEGE); Joana Pinho (Universidade Católica Portuguesa, Católica Porto Business School and CEGE); Giovanni Tabacco

Abstract:

We explore the consequences to contract design if firm shareholders are intent on their managers engaging in price exing activities under different legal regimes. We show that in fine-only legal regimes, optimal contracts must have a fixed wage. In contrast,in fine-plus-prosecution legal regimes optimal contracts must be high-powered,involving a variable component. We test these predictions in a laboratory experiment. We observe contract choices of firm owners, for a given legal regime, as well as the likelihood of managers forming explicit cartels and coordinating on prices in an indefinitely repeated Bertrand oligopoly, taking contract and legal regime as given. The data show that prosecuting managers leads to lower collusion, but high-powered contracts do not incentivize cartel formation or price coordination effectively, irrespective of legal regime. Nevertheless, high-powered contracts were most frequently chosen by firm owners, often with collusive intents.

URL:

http://d.repec.org/n?u=RePEc:cap:wpaper:022020&r=com

January 18, 2021 | Permalink | Comments (0)

Saturday, January 16, 2021

The Great Kosher Meat War of 1902: Immigrant Housewives and the Riots that Shook New York City

Breaking up a trust, group boycott, and an early feminist activist expression of frustration with monopoly power - what a great read!  HT: Will Tom.

 


To visit the book's website, click here.
To purchase the book, click here.

 

The Great Kosher Meat War of 1902: Immigrant Housewives and the Riots that Shook New York City

Scott D. Seligman                          

Potomac Books

University of Nebraska Press

 

American Bookfest 17th Annual Best Book Awards, Finalist

 

In the wee hours of May 15, 1902, some 3,000 immigrant Jewish women quietly took up positions on the streets of Manhattan’s Lower East Side. They assembled in the pitch black in squads of five, determined to shut down every kosher butcher shop in New York’s heavily Jewish quarter.

For years the women had patronized these butchers, who, like them, were observant Jews from Russia and Eastern Europe who had recently arrived in America. But the latest jump in the price of kosher meat had made it unaffordable, and their religious beliefs allowed them no other variety. Convinced that their butchers were gouging them, they saw no choice but to take to the streets.

Customers who crossed their picket lines were heckled and assaulted, their parcels of meat hurled into the gutter. Butchers who refused to close were attacked, their windows smashed, stocks ruined, fixtures destroyed. Brutal blows from police nightsticks sent many women to local hospitals and others to court. But the strikers persevered, and soon Jewish housewives in Brooklyn, the Bronx, Harlem, Newark and even Boston joined them in solidarity, and all the kosher butchers in the metropolitan area either shut their doors or had them shut for them.

Contemporary newspapers described it as a modern Jewish Boston Tea Party.

The true villains in the drama, however, were not the local butchers, but rather a cabal of Chicago-based meat packers who had formed a “Beef Trust” and were colluding to corner the national market for meat. Behind the scenes, they cooperated to manipulate the supply of beef sent to the cities and gouge consumers. Just as the upstart women were laying waste to New York's Lower East Side, “trust-buster” President Theodore Roosevelt launched an effort to break up the meat cartel that would take its members it all the way to the Supreme Court.

 

The book also tells the story of Jacob Joseph, the first and only Chief Rabbi of New York, a talmudic scholar brought to America at great expense to oversee the sanctity of the kosher meat supply in the city, among other tasks. The long knives were out for him, however, and the changes he instituted met with fierce resistance among corrupt players in the meat industry and Jewish consumers.

This first book-length account of the meat protest tells the inspiring story of immigrant women who, certain of the righteousness of their cause, discover their collective power as consumers and find their political voice. With few resources and little experience, but steely determination and a clear understanding of the threat their families faced, these mostly uneducated wives and mothers, some barely conversant in English, organized themselves overnight into a potent fighting force, challenged powerful, vested corporate interests and emerged victorious.

Their foray into the political and economic arena would set a pattern that future generations would employ to address injustice whenever  and wherever they experienced it.

 

January 16, 2021 | Permalink | Comments (0)

Friday, January 15, 2021

Pricing, competition and content for internet service providers

Pricing, competition and content for internet service providers

By:

Key, Peter; Steinberg, Richard

Abstract:

We examine competition between two Internet Service Providers (ISPs), where the first ISP provides basic Internet service, while the second ISP provides Internet service plus content, i.e., enhanced service , where the first ISP can partner with a Content Provider to provide the same content as the second ISP. When such a partnering arrangement occurs, the Content Provider pays the first ISP a transfer price for delivering the content. Users have heterogeneous preferences, and each in general faces three options: (1) buy basic Internet service from the first ISP; (2) buy enhanced service from the second ISP; or (3) buy enhanced service jointly from the first ISP and the Content Provider. We derive results on the existence and uniqueness of a Nash equilibrium, and provide closed-form expressions for the prices, user masses, and profits of the two ISPs and the Content Provider. When the first ISP has the ability to choose the transfer price, then when congestion is linear in the load, it is never optimal for the first ISP to set a negative transfer price in the hope of attracting more revenue from additional customers desiring enhanced service. Conversely, when congestion is sufficiently super-linear, the optimal strategy for the first ISP is either to set a negative transfer price (subsidizing the Content Provider) or to set a high transfer price that shuts the Content Provider out of the market.

URL:

http://d.repec.org/n?u=RePEc:ehl:lserod:107008&r=com

January 15, 2021 | Permalink | Comments (0)

Economic impact of category captaincy: an examination of assortments and prices

Economic impact of category captaincy: an examination of assortments and prices

By:

Viswanathan, Madhu; Narasimhan, Om; John, George

Abstract:

We empirically investigate the impact of category captaincy, an arrangement where the retailer works exclusively with a manufacturer to manage both the manufacturer’s and his rivals’ products. Using a unique data set that contains information on category captaincy as well as SKU-store-level sales and price across 24 retail chains and eight local markets in the United States for a frozen food category, we quantify the impact of captaincy on prices, assortments, profits, and consumer welfare. Interestingly, our estimates suggest that captaincy can lead to welfare gains for consumers, which argues against a purely negative view of captaincy by policy makers.

URL:

http://d.repec.org/n?u=RePEc:ehl:lserod:107034&r=com

January 15, 2021 | Permalink | Comments (0)

Competition policy and the Green Deal


Webinar in European Parliament, with MEP Stephanie Yon-Courtin, 22 September 2020

Competition policy and the Green Deal

Thank you to all who responded to our call for contributions on questions about how competition rules and sustainability policies work together. The call for contributions closed on 20 November 2020, and DG Competition received around 200 contributions, which are now being analysed.

The contributions will be published at the time of the conference organised by DG Competition, to be hosted by Executive Vice President Margrethe Vestager on 4 February 2021. This conference will bring together the different perspectives on this important topic. The programme is here.

Registration for the conference is now open, through the dedicated conference platform.

This follows the announcement in a speech on 22 September 2020, at an event hosted by MEP Stephanie Yon-Courtin, by Executive Vice-President Margrethe Vestager, of her intention to launch a European debate on how EU competition policy can best support the Green Deal.

As EVP Vestager said, competition policy cannot replace environmental laws or green investment. The question is rather if we can do more, to apply our rules in ways that better support the Green Deal.

We are looking for input from everyone with a stake in this issue – including from industry, from environmental groups, consumer organisations, as well as competition experts.

Call for contributions

 BG CS DA DE EL EN ES ET FI FR HR HU IT LT LV MT NL PL PT RO SK SL SV

The European Green Deal aims to transform the EU into a fair and prosperous society, with a modern, resource-efficient and competitive economy. The goal is for Europe to be the first climate neutral continent by 2050, where economic growth is decoupled from resource use. The coronavirus pandemic makes those ambitions even more relevant. The European Commission has put forward a major recovery plan for Europe to help repair the economic and social damage brought by the pandemic and to kick-start the European recovery in line with the twin green and digital transition goals.

As Executive Vice President Vestager has underlined: “To succeed, everyone in Europe will have to play their part – every individual, every public authority. And that includes competition enforcers.”

The goal of EU competition rules is to promote and protect effective competition in markets, delivering efficient outcomes to the benefit of consumers. Competitive markets encourage firms to produce at the lowest cost, to invest efficiently and to innovate and adopt more energy-efficient technologies. Such competitive pressure is a powerful incentive to use our planet’s scarce resources efficiently, and it complements environmental and climate policies and regulation aimed at internalising environmental costs. By helping to achieve efficient and competitive market outcomes, competition policy hence contributes by itself to the effectiveness of green policies. Competition policy is not in the lead when it comes to fighting climate change and protecting the environment. There are better, much more effective ways, such as regulation and taxation. Competition policy, however, can complement regulation and the question is how it could do that most effectively. The Commission is responsible for the enforcement of competition rules based on its competences under the Treaty and existing EU secondary legislation, under the close supervision of the EU Courts. This means that, short of any changes in the existing legal framework, competition policy’s contribution to the Green Deal can only take place within these clearly-defined boundaries.

Student challenge

Competition policy contributing to the European Green Deal is about our future – in the field of competition and on this planet. This is why we believe that future competition experts and professionals must be part of it. If you are interested in competition policy and are currently at university, you are invited to take on the Student Challenge and give yourself a chance to see your contributions published by DG Competition in a special Brief. This is how. Watch the conference webstream (link available soon) on or after 4 February 2021. Choose the panel discussion you liked best; picture yourself among its speakers; and tell us what you would have talked about. You have until 18 February to send your abstracts – no more than 250 words – to COMP-GREEN-DEAL@ec.europa.eu. We will shortlist the best submissions and the public will vote for the final winners. Read the complete Student Challenge rules . Good luck to all.

Contact us

You can contact us by e-mail to COMP-GREEN-DEAL@ec.europa.eu

January 15, 2021 | Permalink | Comments (0)