ABSTRACT
A prevailing belief within modern capitalism is that nothing is better for competitiveness than competition itself. Despite this, policy makers find themselves in the paradoxical situation that many of the beneficiaries of competition are doing their utmost to undermine its intensity. Even the earliest writers on modern economies noted the tendency for competition to self-destruct if left to its own devices. For this reason, competition policy is integral to states’ involvement in the economy. States use competition policy to preserve the desired intensity of com-
regulations that limit the ability of enterprises to operate in a manner that is contrary to this objective. The initial focus of this chapter is to examine the perceived benefits of competition. This will look initially at traditional economic thinking before moving on to examine the role and shape of competition policy. Thereafter, the themes and form of competition policy within the EU are explored. The chapter then examines the processes of change that are affecting competition policy development within the EU, notably trends towards European and
3 4 5 6 7 8 9 10 1 2 3 411 5 611 7 8 9 20111 1 2 3 4 5 6 7 8 9 30 1 2 3 4 5 6 7 8 9 40 1 2 3
Competition is a painful thing, but it produces great results. Jerry Flint, in Forbes
COMPETITION POLICY
Economic theory presents competition as a social good and its maintenance is regarded as pivotal in ensuring efficiency gains, within both enterprises and the economy as a whole. This improved efficiency is expressed in many ways: first, in terms of prices, which are expected to fall as competition intensifies; second, from the pressure for greater cost efficiency within enterprises; and third, from the greater choice of goods and services that arises as more firms enter a particular market.
