The vast majority of the countries in the world are developing countries—there are only thirty-four OECD (Organisation for Economic Co-operation and Development) countries—and yet there is a serious dearth of attention to developing countries in the international and comparative law scholarship, which has been preoccupied with the United States and the European Union. Competition Law and Development investigates whether or not the competition law and policy transplanted from Europe and the United States can be successfully implemented in the developing world or whether the developing-world experience suggests a need for a different analytical framework. The political and economic environment of developing countries often differs significantly from that of developed countries in ways that may have serious implications for competition law enforcement. The need to devote greater attention to developing countries is also justified by the changing global economic reality in which developing countries—especially China, India, and Brazil—have emerged as economic powerhouses. Together with Russia, the so-called BRIC countries have accounted for thirty percent of global economic growth since the term was coined in 2001. In this sense, developing countries deserve more attention not because of any justifiable differences from developed countries in competition law enforcement, either in theoretical or practical terms, but because of their sheer economic heft. This book, the second in the Global Competition Law and Economics series, provides a number of viewpoints of what competition law and policy mean both in theory and practice in a development context.

This book further develops both the traditional and the behavioural approach to competition law, and applies these approaches to a variety of timely issues. It discusses several fundamental questions regarding competition law and economics, and explores the applications of competition law and economics. In turn, the book analyses the interplay of intellectual property rights and patents in various aspects of competition law, and investigates the impacts that developments in information technology, such as big data analytics, have on competition law. The book also discusses the impact of energy law reforms on energy markets from a competition law perspective. Competition law is a classic field of economic analysis. This is largely due to the fact that competition law uses terms such as market, price, and competition and must therefore rely on economic know-how and analyses. In the United States, economic analysis has greatly influenced not just the scholarship on antitrust law, but also judicial decisions and agency enforcement. Antitrust law and economics are based on the traditional paradigm of neoclassical economics, which relies on the assumption that the market players, i.e. consumers and producers, are rational. This approach to competition law was later received in Europe under the banner of a “more economic approach”. For the past two decades, behavioural law and economics, which seeks to generate better insights into legal phenomena by providing more realistic psychological foundations for economic models, and to offer a multitude of applications in legislation and legal adjudication, has challenged the traditional economic approach to law in general and, more recently, to competition law specifically.

This book brings together perspectives of development economics and law to tackle the relationship between competition law enforcement and economic development. It addresses the question of whether, and how, competition law enforcement helps to promote economic growth and development. This question is highly pertinent for developing countries largely because many developing countries have only adopted competition law in recent years: about thirty jurisdictions had in place a competition law in the early 1980s, and there are now more than 130 competition law regimes across the world, of which many are developing countries. The book proposes a customized approach to competition law enforcement for developing countries, set against the background of the academic and policy debate concerning convergence of competition law. The implicit premise of convergence is that there may exist one, or a few, correct approaches to competition law enforcement, which in most cases emanate from developed jurisdictions, that are applicable to all. This book rejects this assumption and argues that developing countries ought to tailor competition law enforcement to their own economic and political circumstances. In particular, it suggests how competition law enforcement can better incorporate development concerns without causing undue dilution of its traditional focus on protecting consumer welfare. It proposes ways in which approaches to competition law enforcement need to be adjusted to reflect the special economic characteristics of developing country economies and the more limited enforcement capacity of developing country competition authorities. Finally, it also addresses the long-running debate concerning the desirability and viability of industrial policy for developing countries. The author would like to acknowledge the Research Grants Council of Hong Kong for its generous support. The work in this book was fully supported by a grant from the Research Grants Council of Hong Kong (Project No. HKU 742412H).

This paper studies the macroeconomic effect and underlying firm-level transmission channels of a reduction in business entry costs. We provide novel evidence on the response of firms' entry, exit, and employment decisions. To do so, we use as a natural experiment a reform in Portugal that reduced entry time and costs. Using the staggered implementation of the policy across the Portuguese municipalities, we find that the reform increased local entry and employment by, respectively, 25% and 4.8% per year in its first four years of implementation. Moreover, around 60% of the increase in employment came from incumbent firms expanding their size, with most of the rise occurring among the most productive firms. Standard models of firm dynamics, which assume a constant elasticity of substitution, are inconsistent with the expansionary and heterogeneous response across incumbent firms. We show that in a model with heterogeneous firms and variable markups the most productive firms face a lower demand elasticity and expand their employment in response to increased entry.

A Financial Times Book of the Year A ProMarket Book of the Year “Superbly argued and important...Donald Trump is in so many ways a product of the defective capitalism described in The Great Reversal. What the U.S. needs, instead, is another Teddy Roosevelt and his energetic trust-busting. Is that still imaginable? All believers in the virtues of competitive capitalism must hope so.” —Martin Wolf, Financial Times “In one industry after another...a few companies have grown so large that they have the power to keep prices high and wages low. It’s great for those corporations—and bad for almost everyone else.” —David Leonhardt, New York Times “Argues that the United States has much to gain by reforming how domestic markets work but also much to regain—a vitality that has been lost since the Reagan years...His analysis points to one way of making America great again: restoring our free-market competitiveness.” —Arthur Herman, Wall Street Journal Why are cell-phone plans so much more expensive in the United States than in Europe? It seems a simple question, but the search for an answer took one of the world’s leading economists on an unexpected journey through some of the most hotly debated issues in his field. He reached a surprising conclusion: American markets, once a model for the world, are giving up on healthy competition. In the age of Silicon Valley start-ups and millennial millionaires, he hardly expected this. But the data from his cutting-edge research proved undeniable. In this compelling tale of economic detective work, we follow Thomas Philippon as he works out the facts and consequences of industry concentration, shows how lobbying and campaign contributions have defanged antitrust regulators, and considers what all this means. Philippon argues that many key problems of the American economy are due not to the flaws of capitalism or globalization but to the concentration of corporate power. By lobbying against competition, the biggest firms drive profits higher while depressing wages and limiting opportunities for investment, innovation, and growth. For the sake of ordinary Americans, he concludes, government needs to get back to what it once did best: keeping the playing field level for competition. It’s time to make American markets great—and free—again.

In this exciting new book, an international team of experts compare market structures, in both global and Korean contexts, particularly focusing on the impact of foreign competition on market concentration and ways to improve market structure. It thoroughly investigates core competition problems, including international abuses of dominance, mergers and collusion, and vertical restraints. Contributions move beyond explaining the laws and practices of enforcement agencies, offering readers an insight into the trend of an ever-increasing interdependence among national economies, complemented by analyses of recent developments in the US and Canada.

The papers here range from description and analysis of how our political economy allocates its inventive effort, to studies of the decision making process in specific industrial laboratories. Originally published in 1962. The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.