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FRIHUMSAM-Fri hum og sam

Improving competition policy

Awarded: NOK 5.0 mill.

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Project Period:

2010 - 2014


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The aim of the research project has been to improve competition policy. It should contribute to a better understanding of the possible impact of competition policy, which in turn would enable us to propose changes that will improve the existing policy recommendations in general and in Norway in particular. Issues that have been raised include both the foundation and impact of competition policy, as well as the enforcement of competition policy in specific cases. The project has contributed to more knowledge on all this areas, through research articles, popular articles, conferences master theses and policy debate in the press. The main results are summarized in a forthcoming book on competition policy, written jointly by an economist and a lawyer.

The aim of the project is to build a better knowledge base for the formulation of competition policy. First, we will analyse how existing rules and procedures and the current organization of the enforcement agency may lead to adverse outcomes, and how cur rent methods may be improved. An important aspect in this respect is to analyse how dynamic considerations can be better integrated into the analysis of competition policy. The project will develop the theory of two-sided markets further, in order to enab le us to provide sound advice to the government to reformulate competition policy in such markets. Second, the project will assess the welfare effects of enforcement. We will discuss how economic methods can be used to detect cartels. Our goal is to adva nce the theory of semicollusion and the theory for detecting cartels in specific industries, as well as to distinguish between harmful and benign information exchange. The theory of vertical relations will be improved to enhance our understanding of the w elfare effects in specific cases. The role of upstream market power on downstream competition will be assessed, and we will discuss whether buyer power might countervail upstream market power. The possible effects of vertical restraints such as resale pri ce maintenance and slotting allowances, two controversial issues, will also be assessed. Third, the impact of competition policy will be investigated. There is no empirical study of the impact of competition policy in Norway, and this project will fill th is gap. We will investigate the possible anticompetitive effect of mergers that are allowed in Norway by the Ministry despite being banned by the Norwegian Competition Authority.

Funding scheme:

FRIHUMSAM-Fri hum og sam