Importance of Competition Policy - Competition Law - Lecture Slides, Slides of Competition Law and Policy

Download Importance of Competition Policy - Competition Law - Lecture Slides and more Slides Competition Law and Policy in PDF only on Docsity! Importance of Competition Policy and Law: Developing Countries’ Perspective Docsity.com IMPORTANCE OF COMPETITION POLICY AND LAW CONTENTS: • Economic benefits of competition; • Need for competitive infrastructure; • Developing countries suffer most from anti- competitive practices; • Competition policy and law are essential development components; • They need to be complemented by market- oriented reforms; • Conversely, market reforms cannot succeed without appropriate competition policy and law. Docsity.com DEVELOPING COUNTRIES SUFFER MOST FROM ANTI-COMPETITIVE PRACTICES • INADEQUATE INFRASTRUCTURES – ISLAND, LAND-LOCKED STATES – POOR COMMUNICATIONS LEAD TO SEGMENTED MARKETS AND LOCAL MONOPOLIES • LOW CAPITAL FORMATION – HIGH INTEREST RATES AND LACK OF ENTREPRISE CULTURE LEAD TO STATE MONOPOLIES & INEFFICIENCIES • ASSYMETRY OF INFORMATION – CONSUMERS UNAWARE OF RIGHTS – TOTAL LACK OF COMPETITION CULTURE Docsity.com NEED FOR COMPETITION POLICY AND LAW • INADEQUATE INFRASTRUCTURES: Segmented markets are prone to cartel formation and monopolies, reduce efficiency of independent business • LOW CAPITAL FORMATION: State or private monopolies with excessive rents distort ressource allocation, reduce efficiency and impair growth of SMEs • ASSYMETRY OF INFORMATION: Lack of entrepreneurial capacity as markets are foreclosed to new entrants by entrenched interests. Docsity.com MARKET-ORIENTED REFORMS NEED COMPETITION RULES • Deregulation and Privatization • FDI liberalization • Trade liberalization Need safeguards against anti-competitive abuses: – International cartels – Abuse of dominance by large firms – Mergers & takeovers monopolizing domestic markets Docsity.com