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on Regulation |
| By: | OECD |
| Abstract: | The regulation of occupations is widespread, extending beyond the liberal professions, such as lawyers and engineers, to a broader set of other economic activities. Competition authorities have long been active in improving competition in these markets, both through enforcement action and by advocating to make regulation more pro-competitive. This paper aims to support competition authorities’ advocacy efforts. It includes an overview of the literature about the effects of regulation of professional services, which competition authorities can draw on to advocate for the benefits of less restrictive regulation where appropriate. The paper also brings together analytical frameworks developed by the OECD and jurisdictions such as Australia, the US and EU to assess regulatory barriers to competition. The paper further draws on case studies of advocacy efforts from competition authorities across a range of OECD member countries. |
| Date: | 2024–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:oec:dafaac:307-en&r= |
| By: | OECD |
| Abstract: | Data plays an increasingly important role for online platforms and the majority of digital business models. Along with data becoming central to competition and the conduct of actors in digital markets, there has been an increase in data privacy regulations and enforcement worldwide. The interplay between competition and data privacy has prompted questions about whether data privacy and the collection of consumers’ data constitute an antitrust issue. Should competition considerations be factored into decisions by data protection authorities, and, if so, how can synergies between the two policy areas be enhanced and tensions overcome? This paper explores the links between competition and data privacy, their respective objectives, and how considerations pertaining to one policy area have been, or could be, included into the other. It investigates enforcement interventions and regulatory measures that could foster synergies or lead to potential challenges, and offers insights into models for co-operation between competition and data protection authorities. This is a joint working paper from the OECD Competition and Digital Economy Policy Secretariat. |
| Date: | 2024–06–07 |
| URL: | https://d.repec.org/n?u=RePEc:oec:dafaac:310-en&r= |
| By: | OECD |
| Abstract: | Competition authorities have already acquired significant knowledge about the concept of market power and dominance as well as practical experience when assessing anticompetitive practices. However, the introduction of potential new concepts, such as economic moats and entrenchment, may complicate this analysis and further blur the lines between lawful and unlawful practices. This paper discusses the relation between economic moats and entrenchment with market power and calls for further reflections among competition authorities and practitioners on the challenges these concepts may pose. It explores several possible options, including incentivising the use of investigative and analytical techniques, as well as strengthening regulatory tools. |
| Date: | 2024–05–20 |
| URL: | http://d.repec.org/n?u=RePEc:oec:dafaac:308-en&r= |
| By: | Coppik, Jürgen |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:diceop:295731&r= |
| By: | Pierre Azoulay; Joshua L. Krieger; Abhishek Nagaraj |
| Abstract: | Drawing insights from the field of innovation economics, we discuss the likely competitive environment shaping generative AI advances. Central to our analysis are the concepts of appropriability—whether firms in the industry are able to control the knowledge generated by their innovations—and complementary assets—whether effective entry requires access to specialized infrastructure and capabilities to which incumbent firms can ration access. While the rapid improvements in AI foundation models promise transformative impacts across broad sectors of the economy, we argue that tight control over complementary assets will likely result in a concentrated market structure, as in past episodes of technological upheaval. We suggest the likely paths through which incumbent firms may restrict entry, confining newcomers to subordinate roles and stifling broad sectoral innovation. We conclude with speculations regarding how this oligopolistic future might be averted. Policy interventions aimed at fractionalizing or facilitating shared access to complementary assets might help preserve competition and incentives for extending the generative AI frontier. Ironically, the best hopes for a vibrant open source AI ecosystem might rest on the presence of a “rogue” technology giant, who might choose openness and engagement with smaller firms as a strategic weapon wielded against other incumbents. |
| JEL: | L17 L86 O32 O38 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32474&r= |
| By: | Bos, Iwan; Maccarrone, Giovanni; Marini, Marco A. |
| Abstract: | Anti-consumerism is a doctrine that aims to discourage excessive consumption because of its damaging effect on the environment. It can either focus on creating psychic costs for consumers (a ‘stick’) or psychic benefits for non-consumers (a ‘carrot’). This paper examines the impact of these two approaches on competition and welfare. The competitive effect is comparable in both cases – anti-consumerism (weakly) reduces competitive pressure as well as prices, outputs and profits. In terms of consumer and social welfare, however, the carrot performs strictly better than the stick. |
| Keywords: | Consumer/Household Economics, Public Economics |
| Date: | 2024–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemwp:342916&r= |
| By: | Mary Chen (Federal Reserve Bank of Boston); Seung Jung Lee (Federal Reserve Board of Governors); Daniel Neuhann (University of Texas at Austin); Farzad Saidi (University of Bonn & CEPR) |
| Abstract: | Bank deregulation in the form of the repeal of the Glass-Steagall Act facilitated the entry of non-bank lenders into the market for syndicated loans during the pre-2008 credit boom. Institutional investors disproportionately purchase tranches of loans originated by universal banks able to cross-sell loans and underwriting services to firms (as permitted by the repeal). A shock to cross-selling intensity increases loan liquidity at origination and over time. The mechanism is that non-loan exposures ensure monitoring even when banks retain small loan shares. Our findings complement the conventional view that regulatory arbitrage caused the rise of non-bank lenders. |
| Keywords: | Non-bank lending, bank deregulation, credit supply, loan liquidity, industrial organization of financial markets |
| JEL: | G20 G21 G23 G28 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:303&r= |
| By: | Xavier Leflaive |
| Abstract: | This paper examines the current status of water availability, water demand, and influences from climate change in the European Union. It provides an overview of economic policy instruments to address water scarcity and manage water demand. Additionally, the paper explores policy options and considerations for addressing water scarcity and meeting Water Framework Directive (WFD) objectives. These considerations include balancing demand management and supply augmentation, managing water scarcity through robust allocation regimes, and increasing the use of agro-environmental measures and practices. The paper also discusses the principles and features of effective allocation regimes, drivers and incentives for allocation reforms, the hierarchy and sequencing of water use, abstraction charges, ensuring return flows and ecological flows, and improving the coherence of WFD measures and climate change policies. This is the third in a sub-set of four working papers within the Environment Working Paper series destined to support the further implementation of the economic pillar of the Water Framework Directive. The four papers are best read in combination and provide lessons which are relevant beyond the European Union. |
| Keywords: | abstraction charges, drought, ecological flows, environmental flows, water allocation, water demand, Water Framework Directive, water scarcity |
| JEL: | H23 H54 H76 O21 Q21 Q25 Q28 Q53 Q58 |
| Date: | 2024–05–24 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaaa:239-en&r= |
| By: | Xavier Leflaive; Aude Farnault |
| Abstract: | This paper examines the concept of cost recovery of water services under the EU Water Framework Directive (WFD), including the different types of costs and cost-recovery mechanisms. It presents the state of play in the implementation of cost recovery in EU Member States, for financial, environmental and resource costs. It also analyses the political, societal and technical issues affecting cost recovery in EU Member States. Furthermore, it examines emerging options to recover rising costs, including ways to minimise costs and innovative arrangements to supplement existing funding streams. Finally, it questions how fit cost recovery is as a concept for emerging and future water-related challenges in the EU. This is the fourth in a sub-set of four working papers within the Environment Working Paper series destined to support the further implementation of the economic pillar of the Water Framework Directive. The four papers are best read in combination and provide lessons which are relevant beyond the European Union. |
| Keywords: | affordability, charges, cost recovery, equity, financing, pricing, tariffs, water |
| JEL: | H23 H54 H76 O21 Q21 Q25 Q28 Q53 Q58 |
| Date: | 2024–05–24 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaaa:240-en&r= |
| By: | 6, Perri; Heims, Eva |
| Abstract: | How does regulatory statehood develop from the regulatory work which governments have always done? This article challenges conventional views that regulatory statehood is achieved by transition to arm's length agencies and that it replaces court-based enforcement or displaces legislatures in favor of less accountable executive power. To do so, we examine the major 19th-century surge in development of micro-economic regulatory statehood in Britain, which had followed more gradual development in early modern times. We show that when the transformation of the Board of Trade is understood properly, a richer appreciation emerges of how regulatory statehood is institutionalized generally and of British state-making in particular. To demonstrate this, we introduce a novel conceptual framework for analyzing and assessing change on multiple dimensions of regulatory statehood, distinguishing depth of regulatory capacity and regulatory capability along six dimensions. |
| Keywords: | state-making; Board of Trade; regulatory capability; regulatory capacity; regulatory state |
| JEL: | R14 J01 |
| Date: | 2024–04–17 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:122982&r= |
| By: | C. Friedrich Kreuser; Michael Kilumelume; Rulof Burger |
| Abstract: | We estimate structural, materials, and labour markups for the South African economy at the three-digit industry level for 2012-19. The fall in structural labour and materials markups found for the numerical majority of industries are generally isolated to smaller industries, with industries accounting for a higher proportion of sales generally experiencing smaller downward shifts. We show that materials-based markups are increasing over this period. |
| Keywords: | Market power, Markups, Competitiveness |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2024-31&r= |
| By: | Tendai Gwatidzo |
| Abstract: | Using data on South Africas commercial banks in the period 20052018, this paper investigates the impact of bank regulation on bank performance. The study uses a fixed effects model to run the regression model as well as the data envelopment analysis approach to estimate efficiency scores. We find a number of interesting results. First, we find a negative relationship between capital stringency and bank performance, suggesting that increased capital requirements force banks to increase their reserves, adversely affecting their performance. Second, we find a positive relationship between activity restrictions and bank performance, indicating that this kind of regulation, which may well be good for the public, as argued by the public interest view of regulation, is also good for the regulated banks. Third, we find a negative and significant relationship between supervisory power and bank performance. Fourth, we find a positive and significant relationship between the market discipline index and bank performance, suggesting that by creating environments characterised by high market discipline, the regulatory regime enhances the ability and incentives of private investors to efficiently monitor banks. This ensures better management of banks, ultimately increasing profitability. Overall, the study finds that regulation matters for bank performance. |
| Date: | 2024–06–03 |
| URL: | https://d.repec.org/n?u=RePEc:rbz:wpaper:11064&r= |
| By: | Michael S. Barr |
| Date: | 2024–05–20 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgsq:98259&r= |