The Political Economy of Competition Policy

By

ACKNOWLEDGEMENT

I would like to express my gratitude regards to my research coordinator, colleagues, family and friends for their relentless support and guidance, without them I would not be able to deliver this work.

DECLARATION

I, (Your name), would like to declare that all contents included in this dissertation stand for my individual work without any aid, and this dissertation has not been submitted for any examination at academic as well as professional level, previously. It is also representing my very own views and not essentially those that are associated with the university.

Signed __________________ Date _________________

TABLE OF CONTENTS

ACKNOWLEDGEMENTII

DECLARATIONIII

CHAPTER 1: INTRODUCTION1

Introduction1

1.1 Background of the Research study1

1.2 Aims and Objectives2

1.3 Problem Statement2

1.4 Research Questions2

1.5 Significance of the Research Study3

CHAPTER 2: LITERATURE REVIEW4

Introduction4

2.1 Conceptual and Theoretical Framework4

2.2 Political Economy6

2.3 Competition through Regulations7

2.4 EU Competition Policy7

2.5 The EU Competition Policy Challenge: Defendants and Reforms8

2.6 The Policy of Competition between Legal Certainty and Economic Efficiency9

2.7 Competition Policy in the Service of Economic Liberalism in Europe10

2.8 The Importance of Competition and Its Benefits11

2.8.1 Economic Meaning of Competition12

2.8.2 Competition and Regulation14

2.9 Benefits of Competition Policy15

2.9.1 Low price for all15

2.9.2 A better quality16

2.9.3 Stronger Face of Global Competition16

2.10 Policy Approaches to Issues of Monopoly Competition and Market Dominance16

2.10.1 Monopolies / Market Dominance16

2.10.2 Monopoly Competition17

2.11 Collusion18

2.12 Merger19

2.13 Privatization and Regulation20

2.14 Vertical Supply Agreements22

CHAPTER 3: METHODOLOGY24

Introduction24

3.1 Scope of the study24

3.2 Research design24

3.3 Rationale for a Qualitative Study25

3.4 Secondary Data25

3.5 Data Collection Methods26

3.6 Limitations of the Research26

3.7 Ethical Considerations27

3.8 Limitations and Suggestion for Future Research28

CHAPTER 4: CRITICAL ANALYSIS29

Introduction29

4.1 Discussion29

4.2 Cases and Examples from the EU & UK Competition Regulations Policies31

4.2.1 Case One: An Acquisition Allowed31

4.2.2 Case Two: Merger Prohibited32

CHAPTER 5: CONCLUSION AND RECOMMENDATIONS34

5.1 Conclusion34

5.2 Recommendation35

REFERENCES37

CHAPTER 1: INTRODUCTION

Introduction

The main objective of carrying out this research was to identify the relationships and impact of competition policy, its benefits and the rules and regulations of the competition within the economy of country. This research has been organized in successive five chapters and reveals the overall impact of political economy of competition policy on the way economy of a country operates as well as influences on functions of the economy, while recommending ways to further enhance the competition policy.

1.1 Background of the Research study

The research study highlights the political economy of competition policy. The research study also highlights the effects of the competition policy on economic development in different parts of the world. The growth of the economy brings prosperity to the country and enhances the economy that gives rise to the GDP of the country. The economic growth can be stimulated through various factors that include the role of financial intermediaries, role of government ownership of the banks and the social factors (Barney, 1991). The role of all these factors is crucial in the economic development of the country. Competition policy in the deregulated sectors is important for several reasons: The natural monopoly sectors, or at least containing a natural monopoly component occupy a place in overall economy of a country - more than in developed economies (Bain, ...